December 4, 2024 • 53 mins
For this episode we might need to adopt a new, honorary name for our podcast – maybe How NOT to Money since this is going to feel at odds with what we typically discuss here on the show! And that’s because ‘budgeting’ is almost synonymous with ‘building wealth’ and living the kind of life you want, but our guest today is offering an alternative to traditional personal finance advice in favor of empowering and flexible strategies. We’re joined by Dana Miranda, author of the new book “You Don’t Need A Budget” which comes out later this month. Dana is a Certified Educator in Personal Finance and is a contributor to the NYT, The Penny Hoarder, and The Motley Fool just to name a few. She is all about building a financial life that works for you as an individual – she’s flipping the personal finance script, ditching the budget, and reimagining your relationship to money entirely, enjoy!
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
Welcome to How to Money. I'm Joel and I am Matt,
and today we're talking no budget Needed with Dana Miranda.
Speaker 2 (00:25):
No budget needed makes me think of like only add water,
or like no milk necessary, Joel, we're eliminating certain elements.
Speaker 1 (00:33):
Or no shirts, no shoes, no service.
Speaker 2 (00:36):
Like I was almost thinking we should adopt like a
new sort of honorary name for the podcast just for
this one episode, right, like instead of how to Money,
we should call it like how Not to Money? Since
I think this is going to feel at odds with
what we typically discuss here on the show, because budgeting
it's almost synonymous with building wealth, with living the kind
of life you want. But our guest today is offering
(00:56):
an alternative to traditional personal finance advice in favor of
empowering and flexible strategies. We're joined by Dana Miranda, author
of the new book You Don't Need a Budget, which
comes out later this month, and Dana is a certified
educator in personal finance. She is also a contributor to
the Times, The Penny Hoarder, Motley Full, Just a Ni
(01:18):
a Few and so Dana, we're really looking forward to
our conversation with you today. Thank you for coming on
the podcast.
Speaker 3 (01:23):
Yeah, thanks for having me. I'm looking forward to it too.
Speaker 1 (01:25):
Of course, glad to have you. First question we ask
everyone is what do they like to euplore? John. It lets
us know a little bit about kind of what you're into,
how you spend your money. But of course, at the
same time you're saving and investing for your future. But
what are you slurging on in the meantime.
Speaker 3 (01:39):
Dana, I like to spend money on long term travel.
So I like to travel just take you know, a
couple of days or a week to go to a place.
But my favorite thing is to go somewhere for like
two or three months. And I live in Wisconsin and
it gets very cold and dark here in the winter.
So the last few years I've also been become a snowbird,
(02:00):
so I like to travel somewhere at least a little
bit warmer and less snowy for a couple of months
over the winter and stay in an airbnb or some
kind of short term rental. Very nice and yeah, and
that ends up being pretty pricey.
Speaker 1 (02:13):
Also known as slow travel, right.
Speaker 2 (02:15):
Sure that sounds, or the slomatic lifestyle.
Speaker 1 (02:19):
I've heard some folks refer to it are you Are
you going domestic? Are you going overseas?
Speaker 2 (02:23):
Like?
Speaker 1 (02:24):
What's your preference just.
Speaker 3 (02:25):
In the US right now? I'd love to do more
overseas travel, but haven't haven't gotten there yet.
Speaker 2 (02:30):
Well, okay, so you mentioned Wisconsin. We were kind of
chatting about this before we hit record data. But like,
it's a wholesome state, it's salt of the earth people,
it's a it's a good group of folks out there.
Speaker 1 (02:39):
I guess, what did you learn about money being out
there in the Midwest.
Speaker 3 (02:43):
The base of my relationship with money, and from what
I see in the culture around me in the Midwest
is very focused on work. We learned work ethic, which
what I didn't know at the time is called the
Protestant work ethic, which is really just it's basically your
duty to work, to work hard, to work diligently, and
(03:08):
that's how you earn money. I grew up in a
working class town, so we were not talking about investment
strategies and how to make our money work for us
and turn our money into more money. You just had
You needed money to live, and you needed to work
to earn money, and so that was kind of where
where your worth lies, and all of the kind of
(03:29):
lessons that I learned about money came from that. So
if I was working hard and earning money, then I
was allowed to spend money where it was basically the
extent of the rules that I learned, and just stay
away from debt because you need to earn your money
rather than borrow it.
Speaker 1 (03:47):
So in some ways those sound like reasonable things to
learn and kind of sort of true, right, Like the
more you work, the more money you end up having.
If you work. Matt and I had recently talked about
this on a Friday flight. There was a study that
said that, and I just think this makes sense, right
that if you work more hours than your peers, you're
going to have more money. You're going to be investing
(04:08):
in your human capital. But that's also not the end
of the story. Did you feel like that you kind
of got short change in your financial education because it
was too focused on the power of work.
Speaker 3 (04:18):
It's really incomplete and not completely accurate either, because work,
and especially you know, high paying work and work that
you can do for a long time or work as
many hours as you want, is not accessible to a
lot of people. So some people might have to stay
home to take care of children or family. Some people
(04:39):
have disabilities that restrict how much they can work, health issues,
chronic health issues. Some people live in areas where there
just are not a lot of work opportunities. And our
culture of work and money, when it stops and only
measures your worth based on how much you work and
how much money you can earn from working, we really
(05:02):
cut out a lot of those people in those circumstances
and devalue them quite a bit. And then when we
give financial advice based on that basic premise of spend
less than you earn, we're also cutting those people out,
because if you're not able to earn enough to pay
for your life, then we really don't have any advice
(05:24):
for you.
Speaker 2 (05:25):
Well, as we're talking about work, I guess maybe let's
spend a second and talk about your career. Because you
started working for a personal finance media startup, and during
that time you were making more money. It sounded like
you were enjoying your job. But I guess share a
little bit about that experience as you've I don't know,
maybe you found yourself in a season of life where
it seemed like it was working out for you.
Speaker 3 (05:47):
That's absolutely right. Yeah, Before I started working in personal
finance media. I was a freelancer for about four or
five years, a freelance writer, and I was making hardly
any money. I was just scraping by. I just couldn't
figure out how to really break into that career. It
was also I started in twenty ten, so we were
still kind of making our way out of the recession.
I didn't know that because I had started broke to
(06:08):
begin with, so I didn't didn't realize how bad the
job market was because I was just getting started. But
in twenty fifteen, I got a full time job working
for this digital media startup that ran a personal finance site,
and I was finally making a full time salary with
benefits and saving for retirement and everything that comes with
(06:29):
a good full time job, and at the same time
getting this masterclass in managing money because I was writing
about it for the site. I thought going into it
that it was going to be really boring. I hadn't
had any interest in personal finance before that, but I
liked the idea of the job and the people that
I would be working with and being a full time writer,
(06:50):
so I gave it a chance. But I really fell
in love with it. I really loved what I was
learning about personal finance and the ability to break down
really complex topics and make them kind of more accessible
for people financially. I was learning a lot, but I
don't feel like I went through the same kind of
journey that a lot of people do when they first
(07:10):
get into personal finance, which is everything that I'm learning
is helping me to pay down debt and make more
money and get my finances in order. What I really
benefited from was just making more money, having a much
more stable income, and access to resources that could help
me kind of get everything else in order.
Speaker 1 (07:29):
So you're writing about these topics and yeah, you're making
more money from doing it, but you didn't feel like
you were able to or you're actually implementing some of
the things that you're writing about and kind of focused on.
Speaker 3 (07:38):
I wasn't a lot of it. Even though it was
fun to write about and to explain a lot of it,
didn't feel like it applied to me all that much.
We were sharing a lot of really nitty gritty at
the time. It wasn't a ton of investment advice. Like
I said, We were kind of at the tail end
of the recession, so it was more about helping people
kind of make ends meet and stretch the money that
(08:00):
they did have, things like even just credit card points,
or when to use a credit card when it makes
sense to, you know, have a credit card that has
an annual fee, like all of these kinds of things.
It was really interesting for me to learn that stuff.
But I was in a position where I had a
terrible credit score because I had had years of debt
and very little money to be able to dig myself
(08:21):
out of it, and so I couldn't even qualify for
a credit card. So I was like starting way back
behind the starting line of what we were advising for people.
And this was supposed to be kind of the accessible
version of personal finance that was like kind of the
common folk personal finance that was a response to the
(08:43):
kind of like Moley Fool or even like CNBC where
they were mostly talking about investment and things that seemed
inaccessible to a lot of people.
Speaker 1 (08:52):
Is that one of the problems in the personal finance space.
I think, I think you're pointing out something that is
real here. I think Matt and I maybe like to
think that at times times, the education we're giving on
how to money is a one on one, but it's
probably not. It's probably a two to oh one or
a twoho two class or something like that. And then
there are things that are three to oh one or
even more advanced. But is it just that we don't
have enough people speaking to the most important things that
(09:16):
like almost to speaking to people who feel like they're
starting behind the starting line.
Speaker 3 (09:20):
We definitely don't have enough of that, and I think
sometimes when we do highlight voices that are speaking to
those people, we're still not talking to people who themselves
are in that position where we're often kind of theorizing.
You know, we attempted to do We've attempted to do
that in various personal finance sites that I've worked for.
(09:42):
Is this idea of taking diversity of you know, diverse
communities and diversity of experience into consideration, but not taking
that too where you'd think would be the natural conclusion,
which is to speak to people or higher writers to
be able to speak to the actual experience of growing
(10:02):
up in poverty or being exiled from your community because
you're an LGBT person whose parents are no longer going
to support you in adulthood. Experiences like that, we would
sort of pay lip service to it, but don't hear
enough from those people to hear what is actually practical
advice that can help you based on your real circumstances.
Speaker 1 (10:23):
Gotcha.
Speaker 2 (10:23):
So you're talking aboutloved experience, and I will say that
my lived experience was that budgeting helped me tremendously.
Speaker 1 (10:30):
Dana, let's talk. I kind of want to get to
the mission I guess of your book.
Speaker 2 (10:34):
Yeah, because you say that you and a liberate folks
from what you call budget culture, and so first of all,
can you define that like what actually like what do
you define as budget culture?
Speaker 3 (10:44):
Budget culture is what I call the dominant way that
we think, teach, and talk about money in our culture.
It's really similar to what I see in diet culture,
which people are a lot of times a lot more
familiar with, in that it kind of defaults to restriction
and shame, and we focus on individual responsibility rather than
(11:10):
accounting for the ways that the systems that we're part
of impact our financial circumstances.
Speaker 1 (11:17):
I think you're right that shame has a big role
in personal finance. So much of the time it has
traditionally and some of the loudest voices often heap the
most shame on people who have made mistakes, and so
they ask for advice and then they're berated for having
done the things they did when they didn't know any better.
You're thinking of a certain guy from Tennessee that let's
(11:38):
do this. I'm not trying to call, so I'm not
pointing figures here in particular.
Speaker 2 (11:41):
I'm I think it also happens to be the physically
loudest voice in the room.
Speaker 1 (11:46):
Sure, but I think there are other people this is
this is a constant problem. I think in the personal
finance space that shame is a cudgel that's used against
people often when they don't have the resources, or the
tools or the no house. I think you're pointing out
something important there. Does it have to be the case? Though?
Can there be a healthy approach to budget culture that
doesn't involve those things where we kind of don't through
(12:08):
out the baby with the bathwater.
Speaker 3 (12:09):
I think that any way of managing money that works
for you, Like you said that, you feel like your
journey involved budgeting and that was really important for you.
I would never tell somebody, First of all, I would
never say, well, actually that probably didn't help you, Like
you know, your experience. And I would also never say, like,
if you're doing it and it feels good for you,
(12:31):
I wouldn't push you away from keeping a budget. I
definitely wrote the book for people who are constantly being
told you need a budget and that it has to
be where you start your money management, and it's just
not making sense for them. We need that variety of
voices and people need to hear it's okay if the
(12:52):
majority of the advice that you're hearing doesn't work for you.
There are other ways to do this, and you can
listen to what makes sense for you. So I know
a lot of people who read the book will probably
still come out of it following a lot of really
traditional financial advice because it's hard to go against the
grain with the systems that we're part of. But it's
(13:12):
important to have that voice in the room that says,
when something doesn't make sense to you, it's okay to
try something else.
Speaker 1 (13:19):
Sure, yeah, maybe there's an alternative path. And I mean
this is I don't have to keep trying to jam
a square peg in a round hole.
Speaker 2 (13:25):
And I think that's one of the reasons we were
most excited to have you on too, because so I
tend like I'm like that personality type that I literally
still budget Dana, and I do zero some budgeting, Like
literally I'm accounting for every single penny and I know
where every cent is spent. But I'm also maybe a
little what do you call that, adh not adhd ocd
that's the actress looking for Whereas with.
Speaker 1 (13:47):
You, though you're you're a little more like shooting from
the hit. I'm more free spirited, and I also have
been pretty frugal over time, so I kind of generally
know where I'm at most of the time. But I
don't pinch pennies, and I don't micromanage where the money goes,
and I don't say, oh, my grocery spending was twenty
bucks over this month. Guess I got to get that
in line. I just I don't think about money in
that way, and as long as I am doing the
(14:10):
you know, paying myself first and moving in the right
direction when it comes to building networth, I'm just not
stressing about the details.
Speaker 2 (14:15):
But for you in particular, like you are great at
like ballparking figures like that is a gift, and I've
seen you do this, whether it's estimating, I don't even
know what, but like you are the.
Speaker 1 (14:24):
Number of jelly beans in a jar map, Yes.
Speaker 2 (14:26):
Like literally, it's everything, like anything from that's like physical
like that, to just kind of ballparking, like how much
something should cost? Like you are so dang good at
ballparking figures, that's.
Speaker 1 (14:35):
Why should go on the price is right, Oh, that's why. Yeah,
you grow up watching right with your grandma. Right, Oh, yeah,
I get it.
Speaker 2 (14:41):
But there are a lot of folks who don't have
that skill or that gift whatever it is that you
want to call it. And so Dana, like, how would
you recommend for folks to improve their finances without the framework,
without the structure that a budget allows you.
Speaker 3 (14:54):
Well, you mentioned the paying yourself first, and I think
that's a really good approach to kind of manage your
money in a way that feels safe but also kind
of empowering and affirming and non restrictive. So I lay
out in the book kind of a series of exercises
(15:15):
that I call a money map that can help you
basically get the lay of the land of your finances
and understand what the income you have coming in, the
resources you have access to, the financial commitments that you
have to meet every month, and the financial goals that
you want to work towards. And once you know that,
(15:36):
you can take that information and see then what is
essentially left over to spend. If you follow all of
those kind of steps, if you meet all those commitments,
and you work toward those goals in a certain way,
you can see what you have left to spend. I
call that a yes fund, because when you're wondering whether
or not you can afford to buy something, I want
(15:57):
the answer to be yes, and so you can then
turn to your Yes fund. It's inspired by a bank
account that I used to have called a safe to
spend account that no longer exists, unfortunately. But the reason
that I recommend something like this instead of a budget
is a budget tends to be a way to plan
(16:17):
for how you use every dollar a lot of times,
encourages you to track all of your spending and encourages
you to set restrictions on how you spend money. And
so a lot of times the answer is no when
you're wondering if you can spend, and a money map
is a way to when you're If you're not good
at making those ballpark estimations, you can get it all
(16:41):
sort of laid out and see what your financial circumstances
are on paper, in the numbers, so that you can
really understand if you start to move things around, how
certain financial decisions and how certain spending decisions are going
to impact other parts of your financial plan. So you
can see if certain financial moves are going to mean
you can't pay your rent one month, or if moving
(17:04):
into a new place that has higher rent, how is
that going to impact your savings goals or you're spending
things like that. It just kind of gives you that
information if you're not able to kind of visualize it yourself.
Speaker 2 (17:15):
Sure, Okay, Yeah, so I like that because what it
sounds like. It sounds like a creative way to solve
problems that are being presented by just not having an
unlimited bank account, right, and so is a part of
the Yes Fund getting creative and finding ways to fund
some of the spending that you are looking to prioritize.
Speaker 3 (17:34):
Yeah, the purpose of it is to not have to
think about what you're spending so much of where your
money is going, because you will do the pay yourself
first method by funding your commitments and funding your goals,
and then the money that you have you can just spend,
So as long as there's money in your account, you
can spend that money without having to think about how
(17:56):
it's impacting your goals and financial commitments. And for me,
it's just a way of getting money off your mind,
which is kind of what I'm always looking for, is
to not have to think about money all the time.
It sounds like a lot of people I think who
really like budgeting or spend tracking maybe enjoy that more
(18:18):
or feel a little more kind of orderly or in
control doing that. I just prefer to not think about
whether or not I can spend money, and so I
like to set up my finances in a way that
I don't have to worry about that.
Speaker 2 (18:30):
Well, that's so fascinating because, like so the reason I budget,
and this is one of the ways that I think
I was able to actually vocalize it when my wife
and I when we're dating or engage at the time,
but that we were able to get on the same
page was that I was able to realize that by budgeting,
that was a way for us to not have to
think about it because we've sort of siloed it, right,
like we've quarantined it, and it was in this part
(18:51):
of our brain where we would intentionally proactively talk about it,
but then after that we didn't have to worry about it.
And so I guess we're arriving at the the same
solution in two very different ways.
Speaker 1 (19:03):
But but yeah, I could. I guess I could see
how your approach there also does.
Speaker 2 (19:07):
That by kind of being like, all right, I can
do whatever I want with this money because this is
the yes fund, this is the safe to spend money.
I don't like there's no second guessing after. In your case,
I guess you're talking about setting that money aside to
build wealth.
Speaker 3 (19:19):
Yeah, And I love that too, that you said you
sort of siloed it. You created a space to make
financial decisions, and then you could just go about your
life and not have to constantly be making financial decisions,
because when you are doing that, you realize that every
single thing you do throughout the day it has something
to do with money. Whether you're making decisions about how
(19:39):
you work, or you're spending money, or even just making
decisions about how to spend your free time or even
just having free time, there's always this thing in the
back of your mind that's like, I could be more
productive right now, you're never not thinking about money. So
anything that works for you and your family to set
that burden aside, I'm all for ye.
Speaker 1 (20:00):
You're in that you have that some of that free
time and you say maybe I should go do this thing.
Oh wait that costs money. Should I spend money? Or
should do something you know that less expensive with my
free time? Like going? I like those are the kinds
of I think decisions. We're like, I don't know that
confront us all the time as just humans living this life.
Or We've got more that we want to get to
(20:20):
with you, Dana and including we want to talk about
budgeting non budgeting tips that you have in the money space.
We'll get to some more discussion with data writing for this.
All right, we are back.
Speaker 2 (20:37):
From the break talking with Dana Miranda and why no
budget is necessary. And Dana, let's talk about a few
lines of attack some of the different chapters in your
book that would be considered I would say heresy most
of the personal finance, Well, you write that you don't
have to earn your living?
Speaker 1 (20:57):
Can you explain what you mean by that?
Speaker 3 (20:59):
So is going off of what I was talking about
earlier with work ethic when you really break it down,
when you break down the idea that when we talk
about earning a living, it is suggesting that you have
to do something to be worthy of having a life,
(21:19):
of having shelter and food and comfort and healthcare and
the things that keep you alive. It's kind of an
absurd concept if you really think about it, and it's
the way that our economic system is set up under capitalism,
that resources exist separate from us, and we have to
do something to be able to purchase those resources and
(21:42):
have access to them. So the idea that you have
to earn a living, I really want to push back
against and break that down again because that's not accessible
to a lot of people. And we have to separate
our personal worth and the way that we value other
people from the work that they do, especially the work
(22:03):
that they do to earn money, so that we're not
devaluing people who are unable to work or choose not
to work outside of the home for any reason.
Speaker 1 (22:12):
Yeah, and I totally get what you're pointing out here.
It also just I'm thinking for some reason about hunter
gatherer societies or early agricultural societies and how just to
stay alive life was work in a lot of ways.
So do you think I guess in my mind, work
and human existence are inextricably tied together. Do you think
that that shouldn't be the case in modern society.
Speaker 3 (22:35):
There's definitely a difference between the work that it takes
to kind of live a life and you know, maybe
keep yourself fed or safe for whatever. When you're talking
hunter gatherer societies and working to earn money. So when
you're working a job to earn money to buy those things,
you're essentially having to prove to probably a corporation or
(22:59):
some kind of company that is holding all the wealth.
You're having to give them some of your time and
skills and energy in order to get just a little
bit of that wealth in order to be able to
buy the things that those companies are selling. And so
it becomes this kind of weird cycle of just needing
(23:20):
to work for a living. So I think the you know,
the idea of the Protestant work ethic that I mentioned
is newly named thing, but it's kind of an ancient
idea and it probably makes more sense when you're in
a society where people are just taking care of their
families and communities and themselves day to day and that's
the work you're doing. Certainly as a human or any animal.
(23:44):
You can't just get through life literally not doing anything,
you know, getting up and moving. But most of us
wouldn't want to either. But the difference comes when there's
that line of like you have to work to earn
money to buy that life, and that that option is
restricted from a lot of people in various ways.
Speaker 2 (24:06):
Well, I like that you said that it's not that
we should not have to do anything, because I think
somewhere some of your booky you wrote that money should
be easy and even you know, kind of going back
to whether it's we're talking about work ethic or even
when it comes to budgeting, And I mean, I think
it's great to look at some of the different If
you have a current model that's laid out before you
and it's not working, certainly consider something different. But like,
(24:28):
if I think to anything in my life that I
was proud of, it oftentimes took a whole lot of work.
Even as a kid, I can think back to like
coming across some cheat codes on this video game and
you'd enter in the cheat codes and all of a
sudden you got I don't know ninety nine lives or.
Speaker 1 (24:42):
Something like that. There was no like satisfaction there's and
I don't know if beating the game isn't nearly as fulfilling.
Speaker 2 (24:48):
As opposed to like having slogged through with your friends
over the course of weeks and months. I guess what
are your thoughts there, just as far as the and
maybe this is a part of that Protestant work ethic,
but like I would say, an inherent goodness that comes
from the sort of struggle where we are required to
sweat and you know, sacrifice as well, Like that's a
(25:09):
massive part of being able to achieve different goals, and
there isn't the same kind of satisfaction in my view
when you bypass that.
Speaker 3 (25:17):
Absolutely, I think you have to think about what the
purpose is. You know. The video game example is a
really good example of kind of how we approach money
in our culture too, because when you use cheat codes
and you just basically skip ahead, you're considering the purpose
to be beating the game or beating what's the thing
(25:41):
at the end.
Speaker 1 (25:41):
Called the ultimate boss, beating.
Speaker 3 (25:44):
The boss at the end. But that's not really the
purpose of playing video games. The purpose is to you know,
have fun with your friends, or spend the time strategizing
or discovering things in the world of the video game.
If everyone can just jump to the end, then there's
really no reason to have the game. There are other
(26:05):
ways to do that. So I think a lot of
times we approach money in that same way of like,
all we want to do is a mass wealth and
a mass the most wealth and hold on to it
as much as we can. But that's really skipping to
the end. The point of having money is to be
able to live the lives that we want, and if
we're not doing that, then we're really missing out.
Speaker 1 (26:28):
It sounds like you're poking a finger in the eye
of the Fire movement there a little bit, which, oh yeah,
I'm kind of I'm with you on, like, oh yeah,
I think there is that sort of element let me
gather as much under my wings as I can, and
often without the thought process for what a life well
lived looks like. And not that every one of the
Fire movements like that, not at all. We've had a
lot of friends who ascribe to that, and there's some
(26:51):
wisdom I'm gleaned from that movement. But I think, yeah,
you're right, Like, what's it all for is an important
question to ask along the way.
Speaker 3 (26:58):
There's a ton of variety in the Fire movement, and
I think the conversations there are really interesting. It certainly
started with that idea of just make as much money
as possible with as many sacrifices as you can handle. Yeah,
and then sort of branched off where a lot of
people I think, started to see this idea of financial
independence sounds really great, so that they don't have to
(27:20):
work for a living, which is a great concept. But
then they thought, but I don't want it to be
at the expense of my life for five or ten years.
I don't want that to be the only thing I'm
thinking about. And so then we have Slow Fire and
other movements that have come along to kind of expand
that idea, and I think it's bringing up really interesting
(27:42):
things in the way that we relate to money and work.
Speaker 1 (27:45):
I agree. I think, yeah, the healthiest part of the
Fire movement has brought up in the past five years,
and it's been around those kinds of conversations and it's
created different paths towards financial independence and a little less
of an adversarial relationship to work. I think maybe that
was at the beginning that was kind of the moniker,
but that's changed. I want to ask you about debt.
There are a couple of things that you write about
(28:06):
that I think also would be kind of if it
was a personal finance textbook, they'd be like, sorry, I
don't know if we can include that. Right. You talk
about leveraging debt to improve your financial situation, but can't
take me on more debt create more money problems for
people down the road. How do you think about the
role of debt in people's lives.
Speaker 3 (28:24):
Sure, yeah. I talk about debt products as a resource
that's available to you right in line. Like when I
talk about making a money map. There's a column for
your income, there's a column for your assets, column for
community resources you have access to, and there's a column
for debt resources, so credit and loans that you could
tap into. And I think it's really important to see
(28:45):
debt that way, because if we just approach debt with fear,
we could be restricting a lot of times the resources
that we have access to, especially if we're not able
to or for some reason don't want to expand what
we can earn in income using debt. It can help
you live the life that you want to live, or
(29:06):
access things that you need that you might not otherwise
be able to. And we know that we talk about
it with businesses a lot leveraging debt. Almost every business
is based on some kind of debt that they're leveraging
and they're just kind of managing it. Business businesses as
an entity or business owners don't tend to have this
(29:26):
idea of needing to get out of debt as quickly
as possible. It's just kind of one of the resources
available to them. And we don't extend that same grace
a lot of times to individuals, especially working class or
middle class individuals, but we do tend to extend it
to like really wealthy individuals a lot of times. But
(29:48):
we could kind of use it in the same way.
Speaker 1 (29:50):
Why do you think that is?
Speaker 2 (29:51):
That's actually I think that's an interesting point that you
bring up the fact that, I mean everything that you
just said, the differences between an institution or a business
and their ability to take on debt, and it just
hanging out as opposed to how it is that we
as individuals approach our debt typically. Is it because our
finances are simpler? I'm curious if you have a theory
(30:12):
as to why it's more acceptable for businesses as opposed
to individuals.
Speaker 3 (30:16):
I think it's kind of a broad systemic thing. So
when we look at sort of the way that our
financial systems and our sort of society and culture in
general are organized, it's really to favor people who are
already wealthy, individuals who are already wealthy, and to favor
businesses amassing more wealth, and so we give them the
(30:42):
tools to do that. And all of our financial products
and services are crafted through legislation that we create and regulation,
and so those entities are able to appeal to the
people creating those regulations that can kind of shape and
craft those products, and individuals don't have that same kind
(31:04):
of leverage a lot of times to influence that regulation
and legislation. And there's also in that sort of system
where we want to just where wealth is kind of
a mass in a very small sort of portion of
(31:25):
our culture, it doesn't benefit that system to have a
lot of individuals be able to tap into a lot
of resources, because that kind of has to go one
direction in order for those financial institutions to make money
off of us borrowing from them. If we were able
(31:45):
to borrow just as easily. The system wouldn't work in
the same way. So I think it's kind of a
broad sort of critique of our financial systems and of
capitalism that is a little bit beyond kind of what
I get into as a personal finance educator. But when
you're thinking about why do we have that distinction, I
(32:06):
think it's important to kind of ask those systemic questions.
Speaker 1 (32:11):
Another thing you say at one point in the book,
you say, you don't have to pay all your bills,
and that would be like a personal finance one on
one course. It would be like, pay your bills on
time every single month would be the advice given. Why
why do you maybe think that's not quite on point?
Speaker 3 (32:27):
Yeah, And my editor really pushed me because I originally
said you don't have to pay your bills, and she said,
maybe just you don't have to pay all of your bills.
She's oftened it a little, which is probably a good idea.
The idea is less that you can just let your
bills pile up and become overdue, and more of looking
(32:48):
at your kind of living expenses, which we often think
about as fixed expenses, looking at them as more changeable
and considering them as financial commitments that you've made, So
you have to actively make a commitment, which means you
can also choose actively to uncommit from something. So I
(33:09):
mentioned earlier, you know, thinking about how the amount of
money you're putting toward housing in rent or mortgage or
something impacts the other things that you're doing in life.
So if you're living somewhere and regularly paying really high rent,
that is impacting your ability to save for something in
the future, or it's impacting your ability to spend day
(33:30):
to day in the way that you want to. You
don't have to feel like you're just stuck with that expense.
You can get creative. And I share a story in
the book about a couple who was living in LA
with really high rent and they wanted to make a
change in the way that they were working. So their
income was going to be cut way down, and in
order to accommodate that, they ended the lease early on
(33:52):
their LA apartment and they bought an airstream and moved
into that and now are years later, are still living
in an RV and traveling around the country, so they
have much lower cost of living to be able to
accommodate that. So that's a big, extreme kind of lifestyle change.
But I want to encourage people to look at financial
(34:14):
commitments and think about what kinds of commitments can you
cut if you need to, and also sometimes what can
go overdo? What can be left to sit or pile
up or whatever, and what are the consequences if you
let that happen, and can you live with those consequences?
Speaker 1 (34:34):
Like some bills are more important than others, the mortgage
more important than the credit card payment. Yeah.
Speaker 2 (34:38):
Well, and as you are explaining to this, Dana, what
I'm hearing you say too is that, like we have
more agency and control over our finances as individuals than
maybe your chapter headings would make you think that you believe,
which is honestly refreshing, right, Like the ability for us
as individuals to choose, you know what, I.
Speaker 1 (34:57):
Don't giving up the expensive apartment.
Speaker 2 (34:58):
I don't want to live here anymore because this is
an important to me anymore. Like to me, like, that's
the empowering message that I can totally get behind. And
so I guess in a similar vein one of your
chapter headings talks about not needing investment accounts, is there
like a silver ligning that's gonna make Joel and Matt
happy about it, all right, talking about that one.
Speaker 3 (35:18):
Make So the stance that I come into that conversation
with is that investing is by necessity an ethical dilemma,
depending on where your values stand. But where my value
stand is that in order to make money from investments,
(35:40):
the underlying companies have to make a profit, and in
order to make a profit, they need to exploit something
in the equation. So there are exploiting people for labor,
they're exploiting environmental resources, they're exploiting consumers with unfair pricing,
things like that, and that's how we make money from investing.
(36:02):
And so just sort of that underlying system of extracting
capital comes with an ethical dilemma. So I kind of
start there, but then also talk about the reality that
we don't have a strong social safety net in this
country that allows you to age and stop working at
(36:23):
some point very easily if you don't have an investment account.
So the message in that chapter is investing is unethical
but maybe inevitable.
Speaker 1 (36:33):
Do you think exploitation has to be part of it,
or is every business built around exploitation, or could you
reframe it and say that many businesses are built around service,
and they have a duty to serve their customers and
their competition with other people to serve those customers, and
that they know if they want to stay in business
and continue to stick around, they have to please the
(36:54):
people they're trying to reach. Like, do you think there's
an element of that too, or is exploitation kind of
the only.
Speaker 3 (36:59):
Thing you see technically under capitalism, Like if you're getting
into sort of a philosophical place, exploitation is built in
because that's where profit comes from. If a company is
making profits, that money is not going to the people
who created the value necessarily. But that is a technical detail,
(37:21):
and I don't think you need to make financial decisions
based on that. I do talk in the book about
considering investing in local businesses or building your own business,
And there's a lot less of what we think of
as exploitation in the way that those businesses tend to
run because the people who are running them are stakeholders
(37:42):
in their community. They have a much closer relationship with
the workers that are adding value to the business, They
have a much closer relationship with the consumers and the
community that's being affected by it, and so the decisions
that are being made there are going to be a
lot more ethical and you can get a lot closer
or to something that kind of makes sense. The problem
(38:03):
with the way that our systems are set up is
that it's pretty tough to make a retirement plan that's
just based around investing in those kinds of businesses because
you know, we have tax advantages.
Speaker 1 (38:16):
All businesses aren't taking investors most of the time.
Speaker 3 (38:18):
Yeah, yeah, a lot of or building your own business
can be really tough and you end up putting a
lot of money into it and like I said, taking
on a lot of debt rather than just accumulating money
like you could in an investment account. And we also
have again regulation and legislation set up to steer people
toward retirement accounts and investment accounts.
Speaker 2 (38:38):
Well, I think we can agree though that the more
local you get, not to say that there isn't fraud
that takes place on a local level, but just waste, right,
Like the higher up you go and the more global
you know, like not just national but even global, but
something gets like there is a lot more room for
there to be practices that are tough to.
Speaker 1 (38:59):
Tough to get behind. Regig just greater levels of bureaucracy
and overhead and a distance from the customers. Yeah as well.
Speaker 2 (39:06):
Yeah, so I think that's certainly a massive argument for
things more at a local level. But Dandy, you've shared
some critiques with the I don't know more of the
traditional approach to personal finances, but we'll get to some
of the different alternatives that you mentioned in your book
as well'll get to that more right after this.
Speaker 1 (39:30):
All right, we're back. We're still talking with Dana or Randa.
Her new book is you Don't Need a Budget, and
that I think it, Matt, When you first read the
headline or where you first read the title of that book,
you cried, a single tier. A single tier went down
your face because you love budget so much. Me, I
was like, I kind of agree with her, but I
think I think it's situationally dependent at least. And data
(39:50):
one of the things you talk about in your book.
You say that the head, the heart, and health should
be motivating factors for how we make financial decisions. Do
you think that traditional personal finance advice minimizes those elemental
parts of who we are?
Speaker 3 (40:08):
Very much? I do. Traditional financial advice I think focuses
very much on the head, which is your sort of
more financial goals, the numbers, the spreadsheets, the way that
you're thinking and making decisions. It's very much focused on
just that part and minimizes a lot of times heart
(40:33):
and health and heart is what I think of as
like your passions and your values and sort of the
core of who you are and your health is your
best interest living life in a way that supports your
physical and mental and social health. And we've sort of
moved in recent years, maybe in the last five or
(40:55):
ten years, to focusing a little more on financial wellness
and thinking about how our financial decisions have that impact
on the heart. We think about choosing work that we're
passionate about. We think about how we can use money
to support joy and peace and ease in our day
to day lives, and not just towards amassing the right
(41:19):
amount of wealth in the right amount of time or
something that's very head focused. But I still see that
we don't think much about our health, our physical and
mental health and well being in the way that we
teach personal finance. That kind of is still left out
(41:39):
of the conversation.
Speaker 1 (41:41):
It's almost like someone needs to start a healthy, rich
substock or something like that.
Speaker 3 (41:45):
Yes, Yeah, someone needs to get that conversation going.
Speaker 1 (41:47):
Someone needs to jump on that ur L. That's the
name of Data's site. You know what.
Speaker 2 (41:53):
Like, what keeps standing out to me, I guess is
the fact that a lot of what you're saying we
actually do agree with, as far as maybe the mechanics
right or in this case, the way you're framing it
here the head, like how the numbers work, this is
how interest works. This will you have more money or
less money at the end of the day if you're
doing X, y Z. But it's almost as if the
(42:14):
general mindset, like the overall attitude towards how you're thinking
about your relationship to money. It's like maybe that's what's changing.
Do you think that that's an accurate way to maybe
summarize some of the different approaches to personal finances out there?
Speaker 3 (42:27):
Yeah, definitely, all three of those things are important. I'm
not saying that we're currently focused on the head and
we need to move into you know, heart and health,
but that you have to consider all three of those
elements of financial wellness and rather than just focusing on
the advice that helps you achieve specific financial goals, so
(42:50):
it's important to see all of those layers in the
financial decisions that you're making and to understand what you
need to support all of those elements of your well being.
Speaker 1 (43:01):
Daniel, you've levied some critiques against the system, right, and
I think we're particularly talking about the American system of
economics capitalism in particular. I'm curious, though, when you look
at the numbers. We live in the most prosperous country
in the history of the world, and there is I
think a reason that people are lined up to immigrate
to the United States. Typically that's because they believe it's
(43:23):
the land of opportunity. They have more ability to move
up and down the income spectrum. Typically move up the
income spectrum from wherever they are coming from, they have
a chance at a better life. I even heard someone
the other day who's from Canada and they said the
best move I ever made was coming to the United States.
And I was like, Oh, that's really interesting because it's
not like Canada is not a prosperous country. You have
(43:45):
a lot of opportunity there as well. So I'm curious.
I guess when you see that and you see that
there's a lot of people who want to come here
and see this as the land of opportunity. What does
that say to you? I guess about the system and
how other people perceive it.
Speaker 3 (43:58):
We have a really effective story in the United States
about the opportunities that people can have under capitalism, and
that continues to motivate people to essentially feed that that
system and do things like support tax cuts for the
(44:22):
wealthy or something because of promises that are made under
the system. But more and more, as we move through history,
more and more the decisions that we're making are making
that kind of mobility harder. And I don't have I
don't have the numbers behind this in my head, but
(44:43):
it is getting harder since you know, about the nineteen eighties,
as we really started changing the way that we regulate
financial products and companies and work. It's getting a lot
harder to have that kind of class mobility that we
lionize in the United States, and the gap between classes
(45:04):
of people is getting bigger and bigger, and so a
lot of that benefit that is part of the American
story is going to a very small percentage of people
in a really kind of profound way, and it's getting
a lot harder for the rest of us, like the
vast majority of us to really be able to tap
into that, and so we're kind of actually stuck without
(45:28):
a ton of mobility. We're sort of stuck in wherever
we whatever kind of class we were born into.
Speaker 2 (45:35):
I think when you look at home, affordability, that's something
that probably I bet a lot of folks look to
as like, man, my parents and my grandparents, they all
have the ability to afford I guess at the time
the housing boom, like they're all the ranges that were
being built, so like everybody had the ability to buy
their own home. But still I can still not think
of a country I'd rather live than myself, even with
the US and all of its flaws and all the
(45:58):
flaws that capitalism has, I mean, certainly not perfect, but man,
it's tough for me to look past like the innovation
that takes place here in the US, Like even like
healthcare as busted of a system we have, Like if
folks are looking for like the very best health care,
like when it comes to you know, just think about
vain know the vaccines that we were able to roll
out and stend out to the rest of the world.
But even certain things like it makes me think of
(46:19):
like cancer research and treatments, like people come from all
over the world because of I certainly don't want to
make an argument for that. Our healthcare system.
Speaker 1 (46:27):
Is it only costs twice as much as every other
developed country, and what could be wrong. It is not
perfect by any stretch of the imagination, but we are
because of the way we're structured. We are incentivizing the
cures for a lot of these diseases and treatments for
a lot of these diseases that aren't getting made anywhere else.
And so in some ways, some of these other countries
are riding our coatails. And so there's that element too.
(46:50):
So I don't know what to do to fix a
busted system, but I feel like, Dana, you pointed out
some of the flaws incredibly well, and specifically some of
the flaws out of the ways that we think about
personal finance. Your perspective is an important one. So thank
you so much, Dana for joining us on the show today.
And where can our listeners find out more about you
and your new book?
Speaker 3 (47:11):
Yeah, thanks for having me, and I also really appreciate
you being willing to have the conversation and look at
that kind of counter countercultural perspective. So you can find
out all about the book at youdn'tneedabudget dot com and
you can follow me on substag or to subscribe through
email to healthy Rich at healthy rich dot co.
Speaker 2 (47:34):
Heck, yeah, we'll make sure to link to all that
in our show notes as well. Dana, thank you so
much for speaking with us today.
Speaker 1 (47:39):
Yeah, thanks for having me all right, Matt, that was
a really interesting conversation with Dana. Miranda and I think
she comes from a different perspective than you and I
typically do, but we wanted to hear from her, and
I learned a lot talking to her, and I really
loved kind of reading her book and hearing her approach.
I'm curious, what was your big takeaway from this conversation. Well, say,
(48:00):
I was encouraged.
Speaker 2 (48:01):
I guess Towards the end of the conversation, I realized
that it seems like we've got more in common than
maybe the title of her book or the chapter headings
in her book might make you think. And when she
was talking about choosing what bills to pay, you can
have those clickable headlines, Matt and I totally understand that.
But when she was talking about certain bills being more
important than others. Like the root of what she was
(48:23):
talking about and what she said was that, like, you
have actively committed to taking on this financial obligation, this expense,
and you can actively uncommit to doing that too. And
so what is at the core of that is autonomy,
an agency, and an ability for us as individuals to
choose how it is that we want to live our life,
as opposed to being like taking a more passive approach
(48:44):
or posture towards your our personal finances where we're counting
on the government to bail us out or to take
care of this, or for somebody else, or not even
the government, but even like some nonprofit where we're just
sitting on the sidelines waiting for them to come along.
Speaker 1 (48:57):
And sometimes that's necessary, right, There is not a hard times.
There is a.
Speaker 2 (49:01):
Place for organizations like that, for churches, for just some
of the systems that we've even set up through our government.
Like I'm not I'm not one to say to burn
it all down in that we need to be completely
abolishing our garment. I'm not advocating for anarchy. Matt doesn't
want kids to school lunches. We need we need rules
for our government with the kids eat, I say, Matt.
Speaker 1 (49:22):
To function, but I guess yeah.
Speaker 2 (49:24):
I wanted to highlight the fact that I was encouraged
that at the end of the day, we do have
power to direct our lives, not only by what we
choose to do, but what it is that we choose
to spend our money.
Speaker 1 (49:34):
On and what we choose not to spend our money one. So,
I think my big takeaway was when we were talking
about debt and she was talking about nuanced in Shades
of Gray in how we think about debt and which
debts we choose to pay off and win. And I
think there's a lot of wisdom in that this is
something I think maybe she comes at it from a
slightly different slant than you and I do, but I
think she's spot on like you and I are.
Speaker 3 (49:55):
Not.
Speaker 1 (49:56):
Debt is bad. Payoff debt as quickly as possible, short
of people. Some debt can be good debt. Some debt
can actually fuel your financial journey at times. I think
if we be really really careful, because there are a
lot of nefarious forms of debt that can derail your
financial journey, they might get you something that you want
now that maybe you should have waited for and saved
up for. But there are other times where taking on
(50:19):
a measured amount of debt can help you make more progress.
So just maybe we need a more nuanced discussion about debt.
That's something we try to do here on the show. Yeah,
and we always have Yeah when people ask us questions
about it. Well, yeah, don't take out a personal loan.
Personal loans suck. Credit card debt sucks. But then there
are other forms of debt that can be beneficial to
your ultimate ability to earn more, to buy a house
(50:42):
that you don't have, you know, cash to pay for
the full thing for, like a mortgage can make sense, right,
So just be thoughtful about debt, but maybe don't rule
debt out of your life altogether. Totally.
Speaker 2 (50:53):
Yeah, this is one of those instances where I feel
like we are in the extreme middle. We're kind of
like refereeing a fight between Dave Raims and Dana Miranda
when it comes to different things like this. But yeah,
in the end, certainly glad that we were able to
spend a minute and talk with Dana Miranda. Joel, Let's
get to the beer that you and I enjoyed during
this episode, which was a silent accord is what this
(51:16):
was by Six Bridges brewing out of John's Creek. And
I don't know if you've ever had a beer by
these guys on the show is different Georgia or Atlanta
suburb And no, I don't think I ever had any
beer by these guys.
Speaker 1 (51:30):
But I picked this one up, saw it on the shelf,
and I was like, that looks interesting. And this to me,
I like the Matt label. Yeah, it makes me want
to scratch up with my fingernail. This beer reminded me
of a beer by another local brewery, Creature Comforts. They're
Cocoa Bunny. Oh, because it's got the coconut and vanilla
thing going on in This is in a milk stout.
They do a milk porter, but this is a milk porter. Yeah, Okay,
(51:53):
this is good, but Coco Bunny's better think so. Yeah,
it's just got such good roasty like this.
Speaker 2 (51:59):
Is the kind of beer that you can enjoy in
the afternoon, like after lunch, if you're wanting some of
those coffee like flavors but you're afraid of like getting
that ninety milligram hit of caffeine this close to your bedtime.
That's what's going through my head at least when I'm like, yeah,
I really shouldn't have any coffee this afternoon because it's
gonna impact me instead, that's when you reach for a
delicious stout like this.
Speaker 1 (52:19):
So I need to do more research on this. But
I've read that coffee impacts people differently based on their genetics,
and I'm pretty I'm pretty sure I'm one of those
people who coffee doesn't have nearly as much of an
impact on as others.
Speaker 2 (52:30):
Or maybe it's because you sleep so poorly all the time.
That could be that, Like your body's just like extra
hit of caffeine.
Speaker 1 (52:37):
That's nothing, all right, But we got a jet for now.
That's gonna do it. For this episode. We'll put links
to Dana's book into her substack in the show notes
up on our website at howtomoney dot com. You know it.
That's gonna be it, though, So until
Speaker 2 (52:51):
Next time, best Friends Out and best Friends Out
Welcome to How to Money. I'm Joel and I am Matt,
and today we're talking no budget Needed with Dana Miranda.
Speaker 2 (00:25):
No budget needed makes me think of like only add water,
or like no milk necessary, Joel, we're eliminating certain elements.
Speaker 1 (00:33):
Or no shirts, no shoes, no service.
Speaker 2 (00:36):
Like I was almost thinking we should adopt like a
new sort of honorary name for the podcast just for
this one episode, right, like instead of how to Money,
we should call it like how Not to Money? Since
I think this is going to feel at odds with
what we typically discuss here on the show, because budgeting
it's almost synonymous with building wealth, with living the kind
of life you want. But our guest today is offering
(00:56):
an alternative to traditional personal finance advice in favor of
empowering and flexible strategies. We're joined by Dana Miranda, author
of the new book You Don't Need a Budget, which
comes out later this month, and Dana is a certified
educator in personal finance. She is also a contributor to
the Times, The Penny Hoarder, Motley Full, Just a Ni
(01:18):
a Few and so Dana, we're really looking forward to
our conversation with you today. Thank you for coming on
the podcast.
Speaker 3 (01:23):
Yeah, thanks for having me. I'm looking forward to it too.
Speaker 1 (01:25):
Of course, glad to have you. First question we ask
everyone is what do they like to euplore? John. It lets
us know a little bit about kind of what you're into,
how you spend your money. But of course, at the
same time you're saving and investing for your future. But
what are you slurging on in the meantime.
Speaker 3 (01:39):
Dana, I like to spend money on long term travel.
So I like to travel just take you know, a
couple of days or a week to go to a place.
But my favorite thing is to go somewhere for like
two or three months. And I live in Wisconsin and
it gets very cold and dark here in the winter.
So the last few years I've also been become a snowbird,
(02:00):
so I like to travel somewhere at least a little
bit warmer and less snowy for a couple of months
over the winter and stay in an airbnb or some
kind of short term rental. Very nice and yeah, and
that ends up being pretty pricey.
Speaker 1 (02:13):
Also known as slow travel, right.
Speaker 2 (02:15):
Sure that sounds, or the slomatic lifestyle.
Speaker 1 (02:19):
I've heard some folks refer to it are you Are
you going domestic? Are you going overseas?
Speaker 2 (02:23):
Like?
Speaker 1 (02:24):
What's your preference just.
Speaker 3 (02:25):
In the US right now? I'd love to do more
overseas travel, but haven't haven't gotten there yet.
Speaker 2 (02:30):
Well, okay, so you mentioned Wisconsin. We were kind of
chatting about this before we hit record data. But like,
it's a wholesome state, it's salt of the earth people,
it's a it's a good group of folks out there.
Speaker 1 (02:39):
I guess, what did you learn about money being out
there in the Midwest.
Speaker 3 (02:43):
The base of my relationship with money, and from what
I see in the culture around me in the Midwest
is very focused on work. We learned work ethic, which
what I didn't know at the time is called the
Protestant work ethic, which is really just it's basically your
duty to work, to work hard, to work diligently, and
(03:08):
that's how you earn money. I grew up in a
working class town, so we were not talking about investment
strategies and how to make our money work for us
and turn our money into more money. You just had
You needed money to live, and you needed to work
to earn money, and so that was kind of where
where your worth lies, and all of the kind of
(03:29):
lessons that I learned about money came from that. So
if I was working hard and earning money, then I
was allowed to spend money where it was basically the
extent of the rules that I learned, and just stay
away from debt because you need to earn your money
rather than borrow it.
Speaker 1 (03:47):
So in some ways those sound like reasonable things to
learn and kind of sort of true, right, Like the
more you work, the more money you end up having.
If you work. Matt and I had recently talked about
this on a Friday flight. There was a study that
said that, and I just think this makes sense, right
that if you work more hours than your peers, you're
going to have more money. You're going to be investing
(04:08):
in your human capital. But that's also not the end
of the story. Did you feel like that you kind
of got short change in your financial education because it
was too focused on the power of work.
Speaker 3 (04:18):
It's really incomplete and not completely accurate either, because work,
and especially you know, high paying work and work that
you can do for a long time or work as
many hours as you want, is not accessible to a
lot of people. So some people might have to stay
home to take care of children or family. Some people
(04:39):
have disabilities that restrict how much they can work, health issues,
chronic health issues. Some people live in areas where there
just are not a lot of work opportunities. And our
culture of work and money, when it stops and only
measures your worth based on how much you work and
how much money you can earn from working, we really
(05:02):
cut out a lot of those people in those circumstances
and devalue them quite a bit. And then when we
give financial advice based on that basic premise of spend
less than you earn, we're also cutting those people out,
because if you're not able to earn enough to pay
for your life, then we really don't have any advice
(05:24):
for you.
Speaker 2 (05:25):
Well, as we're talking about work, I guess maybe let's
spend a second and talk about your career. Because you
started working for a personal finance media startup, and during
that time you were making more money. It sounded like
you were enjoying your job. But I guess share a
little bit about that experience as you've I don't know,
maybe you found yourself in a season of life where
it seemed like it was working out for you.
Speaker 3 (05:47):
That's absolutely right. Yeah, Before I started working in personal
finance media. I was a freelancer for about four or
five years, a freelance writer, and I was making hardly
any money. I was just scraping by. I just couldn't
figure out how to really break into that career. It
was also I started in twenty ten, so we were
still kind of making our way out of the recession.
I didn't know that because I had started broke to
(06:08):
begin with, so I didn't didn't realize how bad the
job market was because I was just getting started. But
in twenty fifteen, I got a full time job working
for this digital media startup that ran a personal finance site,
and I was finally making a full time salary with
benefits and saving for retirement and everything that comes with
(06:29):
a good full time job, and at the same time
getting this masterclass in managing money because I was writing
about it for the site. I thought going into it
that it was going to be really boring. I hadn't
had any interest in personal finance before that, but I
liked the idea of the job and the people that
I would be working with and being a full time writer,
(06:50):
so I gave it a chance. But I really fell
in love with it. I really loved what I was
learning about personal finance and the ability to break down
really complex topics and make them kind of more accessible
for people financially. I was learning a lot, but I
don't feel like I went through the same kind of
journey that a lot of people do when they first
(07:10):
get into personal finance, which is everything that I'm learning
is helping me to pay down debt and make more
money and get my finances in order. What I really
benefited from was just making more money, having a much
more stable income, and access to resources that could help
me kind of get everything else in order.
Speaker 1 (07:29):
So you're writing about these topics and yeah, you're making
more money from doing it, but you didn't feel like
you were able to or you're actually implementing some of
the things that you're writing about and kind of focused on.
Speaker 3 (07:38):
I wasn't a lot of it. Even though it was
fun to write about and to explain a lot of it,
didn't feel like it applied to me all that much.
We were sharing a lot of really nitty gritty at
the time. It wasn't a ton of investment advice. Like
I said, We were kind of at the tail end
of the recession, so it was more about helping people
kind of make ends meet and stretch the money that
(08:00):
they did have, things like even just credit card points,
or when to use a credit card when it makes
sense to, you know, have a credit card that has
an annual fee, like all of these kinds of things.
It was really interesting for me to learn that stuff.
But I was in a position where I had a
terrible credit score because I had had years of debt
and very little money to be able to dig myself
(08:21):
out of it, and so I couldn't even qualify for
a credit card. So I was like starting way back
behind the starting line of what we were advising for people.
And this was supposed to be kind of the accessible
version of personal finance that was like kind of the
common folk personal finance that was a response to the
(08:43):
kind of like Moley Fool or even like CNBC where
they were mostly talking about investment and things that seemed
inaccessible to a lot of people.
Speaker 1 (08:52):
Is that one of the problems in the personal finance space.
I think, I think you're pointing out something that is
real here. I think Matt and I maybe like to
think that at times times, the education we're giving on
how to money is a one on one, but it's
probably not. It's probably a two to oh one or
a twoho two class or something like that. And then
there are things that are three to oh one or
even more advanced. But is it just that we don't
have enough people speaking to the most important things that
(09:16):
like almost to speaking to people who feel like they're
starting behind the starting line.
Speaker 3 (09:20):
We definitely don't have enough of that, and I think
sometimes when we do highlight voices that are speaking to
those people, we're still not talking to people who themselves
are in that position where we're often kind of theorizing.
You know, we attempted to do We've attempted to do
that in various personal finance sites that I've worked for.
(09:42):
Is this idea of taking diversity of you know, diverse
communities and diversity of experience into consideration, but not taking
that too where you'd think would be the natural conclusion,
which is to speak to people or higher writers to
be able to speak to the actual experience of growing
(10:02):
up in poverty or being exiled from your community because
you're an LGBT person whose parents are no longer going
to support you in adulthood. Experiences like that, we would
sort of pay lip service to it, but don't hear
enough from those people to hear what is actually practical
advice that can help you based on your real circumstances.
Speaker 1 (10:23):
Gotcha.
Speaker 2 (10:23):
So you're talking aboutloved experience, and I will say that
my lived experience was that budgeting helped me tremendously.
Speaker 1 (10:30):
Dana, let's talk. I kind of want to get to
the mission I guess of your book.
Speaker 2 (10:34):
Yeah, because you say that you and a liberate folks
from what you call budget culture, and so first of all,
can you define that like what actually like what do
you define as budget culture?
Speaker 3 (10:44):
Budget culture is what I call the dominant way that
we think, teach, and talk about money in our culture.
It's really similar to what I see in diet culture,
which people are a lot of times a lot more
familiar with, in that it kind of defaults to restriction
and shame, and we focus on individual responsibility rather than
(11:10):
accounting for the ways that the systems that we're part
of impact our financial circumstances.
Speaker 1 (11:17):
I think you're right that shame has a big role
in personal finance. So much of the time it has
traditionally and some of the loudest voices often heap the
most shame on people who have made mistakes, and so
they ask for advice and then they're berated for having
done the things they did when they didn't know any better.
You're thinking of a certain guy from Tennessee that let's
(11:38):
do this. I'm not trying to call, so I'm not
pointing figures here in particular.
Speaker 2 (11:41):
I'm I think it also happens to be the physically
loudest voice in the room.
Speaker 1 (11:46):
Sure, but I think there are other people this is
this is a constant problem. I think in the personal
finance space that shame is a cudgel that's used against
people often when they don't have the resources, or the
tools or the no house. I think you're pointing out
something important there. Does it have to be the case? Though?
Can there be a healthy approach to budget culture that
doesn't involve those things where we kind of don't through
(12:08):
out the baby with the bathwater.
Speaker 3 (12:09):
I think that any way of managing money that works
for you, Like you said that, you feel like your
journey involved budgeting and that was really important for you.
I would never tell somebody, First of all, I would
never say, well, actually that probably didn't help you, Like
you know, your experience. And I would also never say, like,
if you're doing it and it feels good for you,
(12:31):
I wouldn't push you away from keeping a budget. I
definitely wrote the book for people who are constantly being
told you need a budget and that it has to
be where you start your money management, and it's just
not making sense for them. We need that variety of
voices and people need to hear it's okay if the
(12:52):
majority of the advice that you're hearing doesn't work for you.
There are other ways to do this, and you can
listen to what makes sense for you. So I know
a lot of people who read the book will probably
still come out of it following a lot of really
traditional financial advice because it's hard to go against the
grain with the systems that we're part of. But it's
(13:12):
important to have that voice in the room that says,
when something doesn't make sense to you, it's okay to
try something else.
Speaker 1 (13:19):
Sure, yeah, maybe there's an alternative path. And I mean
this is I don't have to keep trying to jam
a square peg in a round hole.
Speaker 2 (13:25):
And I think that's one of the reasons we were
most excited to have you on too, because so I
tend like I'm like that personality type that I literally
still budget Dana, and I do zero some budgeting, Like
literally I'm accounting for every single penny and I know
where every cent is spent. But I'm also maybe a
little what do you call that, adh not adhd ocd
that's the actress looking for Whereas with.
Speaker 1 (13:47):
You, though you're you're a little more like shooting from
the hit. I'm more free spirited, and I also have
been pretty frugal over time, so I kind of generally
know where I'm at most of the time. But I
don't pinch pennies, and I don't micromanage where the money goes,
and I don't say, oh, my grocery spending was twenty
bucks over this month. Guess I got to get that
in line. I just I don't think about money in
that way, and as long as I am doing the
(14:10):
you know, paying myself first and moving in the right
direction when it comes to building networth, I'm just not
stressing about the details.
Speaker 2 (14:15):
But for you in particular, like you are great at
like ballparking figures like that is a gift, and I've
seen you do this, whether it's estimating, I don't even
know what, but like you are the.
Speaker 1 (14:24):
Number of jelly beans in a jar map, Yes.
Speaker 2 (14:26):
Like literally, it's everything, like anything from that's like physical
like that, to just kind of ballparking, like how much
something should cost? Like you are so dang good at
ballparking figures, that's.
Speaker 1 (14:35):
Why should go on the price is right, Oh, that's why. Yeah,
you grow up watching right with your grandma. Right, Oh, yeah,
I get it.
Speaker 2 (14:41):
But there are a lot of folks who don't have
that skill or that gift whatever it is that you
want to call it. And so Dana, like, how would
you recommend for folks to improve their finances without the framework,
without the structure that a budget allows you.
Speaker 3 (14:54):
Well, you mentioned the paying yourself first, and I think
that's a really good approach to kind of manage your
money in a way that feels safe but also kind
of empowering and affirming and non restrictive. So I lay
out in the book kind of a series of exercises
(15:15):
that I call a money map that can help you
basically get the lay of the land of your finances
and understand what the income you have coming in, the
resources you have access to, the financial commitments that you
have to meet every month, and the financial goals that
you want to work towards. And once you know that,
(15:36):
you can take that information and see then what is
essentially left over to spend. If you follow all of
those kind of steps, if you meet all those commitments,
and you work toward those goals in a certain way,
you can see what you have left to spend. I
call that a yes fund, because when you're wondering whether
or not you can afford to buy something, I want
(15:57):
the answer to be yes, and so you can then
turn to your Yes fund. It's inspired by a bank
account that I used to have called a safe to
spend account that no longer exists, unfortunately. But the reason
that I recommend something like this instead of a budget
is a budget tends to be a way to plan
(16:17):
for how you use every dollar a lot of times,
encourages you to track all of your spending and encourages
you to set restrictions on how you spend money. And
so a lot of times the answer is no when
you're wondering if you can spend, and a money map
is a way to when you're If you're not good
at making those ballpark estimations, you can get it all
(16:41):
sort of laid out and see what your financial circumstances
are on paper, in the numbers, so that you can
really understand if you start to move things around, how
certain financial decisions and how certain spending decisions are going
to impact other parts of your financial plan. So you
can see if certain financial moves are going to mean
you can't pay your rent one month, or if moving
(17:04):
into a new place that has higher rent, how is
that going to impact your savings goals or you're spending
things like that. It just kind of gives you that
information if you're not able to kind of visualize it yourself.
Speaker 2 (17:15):
Sure, Okay, Yeah, so I like that because what it
sounds like. It sounds like a creative way to solve
problems that are being presented by just not having an
unlimited bank account, right, and so is a part of
the Yes Fund getting creative and finding ways to fund
some of the spending that you are looking to prioritize.
Speaker 3 (17:34):
Yeah, the purpose of it is to not have to
think about what you're spending so much of where your
money is going, because you will do the pay yourself
first method by funding your commitments and funding your goals,
and then the money that you have you can just spend,
So as long as there's money in your account, you
can spend that money without having to think about how
(17:56):
it's impacting your goals and financial commitments. And for me,
it's just a way of getting money off your mind,
which is kind of what I'm always looking for, is
to not have to think about money all the time.
It sounds like a lot of people I think who
really like budgeting or spend tracking maybe enjoy that more
(18:18):
or feel a little more kind of orderly or in
control doing that. I just prefer to not think about
whether or not I can spend money, and so I
like to set up my finances in a way that
I don't have to worry about that.
Speaker 2 (18:30):
Well, that's so fascinating because, like so the reason I budget,
and this is one of the ways that I think
I was able to actually vocalize it when my wife
and I when we're dating or engage at the time,
but that we were able to get on the same
page was that I was able to realize that by budgeting,
that was a way for us to not have to
think about it because we've sort of siloed it, right,
like we've quarantined it, and it was in this part
(18:51):
of our brain where we would intentionally proactively talk about it,
but then after that we didn't have to worry about it.
And so I guess we're arriving at the the same
solution in two very different ways.
Speaker 1 (19:03):
But but yeah, I could. I guess I could see
how your approach there also does.
Speaker 2 (19:07):
That by kind of being like, all right, I can
do whatever I want with this money because this is
the yes fund, this is the safe to spend money.
I don't like there's no second guessing after. In your case,
I guess you're talking about setting that money aside to
build wealth.
Speaker 3 (19:19):
Yeah, And I love that too, that you said you
sort of siloed it. You created a space to make
financial decisions, and then you could just go about your
life and not have to constantly be making financial decisions,
because when you are doing that, you realize that every
single thing you do throughout the day it has something
to do with money. Whether you're making decisions about how
(19:39):
you work, or you're spending money, or even just making
decisions about how to spend your free time or even
just having free time, there's always this thing in the
back of your mind that's like, I could be more
productive right now, you're never not thinking about money. So
anything that works for you and your family to set
that burden aside, I'm all for ye.
Speaker 1 (20:00):
You're in that you have that some of that free
time and you say maybe I should go do this thing.
Oh wait that costs money. Should I spend money? Or
should do something you know that less expensive with my
free time? Like going? I like those are the kinds
of I think decisions. We're like, I don't know that
confront us all the time as just humans living this life.
Or We've got more that we want to get to
(20:20):
with you, Dana and including we want to talk about
budgeting non budgeting tips that you have in the money space.
We'll get to some more discussion with data writing for this.
All right, we are back.
Speaker 2 (20:37):
From the break talking with Dana Miranda and why no
budget is necessary. And Dana, let's talk about a few
lines of attack some of the different chapters in your
book that would be considered I would say heresy most
of the personal finance, Well, you write that you don't
have to earn your living?
Speaker 1 (20:57):
Can you explain what you mean by that?
Speaker 3 (20:59):
So is going off of what I was talking about
earlier with work ethic when you really break it down,
when you break down the idea that when we talk
about earning a living, it is suggesting that you have
to do something to be worthy of having a life,
(21:19):
of having shelter and food and comfort and healthcare and
the things that keep you alive. It's kind of an
absurd concept if you really think about it, and it's
the way that our economic system is set up under capitalism,
that resources exist separate from us, and we have to
do something to be able to purchase those resources and
(21:42):
have access to them. So the idea that you have
to earn a living, I really want to push back
against and break that down again because that's not accessible
to a lot of people. And we have to separate
our personal worth and the way that we value other
people from the work that they do, especially the work
(22:03):
that they do to earn money, so that we're not
devaluing people who are unable to work or choose not
to work outside of the home for any reason.
Speaker 1 (22:12):
Yeah, and I totally get what you're pointing out here.
It also just I'm thinking for some reason about hunter
gatherer societies or early agricultural societies and how just to
stay alive life was work in a lot of ways.
So do you think I guess in my mind, work
and human existence are inextricably tied together. Do you think
that that shouldn't be the case in modern society.
Speaker 3 (22:35):
There's definitely a difference between the work that it takes
to kind of live a life and you know, maybe
keep yourself fed or safe for whatever. When you're talking
hunter gatherer societies and working to earn money. So when
you're working a job to earn money to buy those things,
you're essentially having to prove to probably a corporation or
(22:59):
some kind of company that is holding all the wealth.
You're having to give them some of your time and
skills and energy in order to get just a little
bit of that wealth in order to be able to
buy the things that those companies are selling. And so
it becomes this kind of weird cycle of just needing
(23:20):
to work for a living. So I think the you know,
the idea of the Protestant work ethic that I mentioned
is newly named thing, but it's kind of an ancient
idea and it probably makes more sense when you're in
a society where people are just taking care of their
families and communities and themselves day to day and that's
the work you're doing. Certainly as a human or any animal.
(23:44):
You can't just get through life literally not doing anything,
you know, getting up and moving. But most of us
wouldn't want to either. But the difference comes when there's
that line of like you have to work to earn
money to buy that life, and that that option is
restricted from a lot of people in various ways.
Speaker 2 (24:06):
Well, I like that you said that it's not that
we should not have to do anything, because I think
somewhere some of your booky you wrote that money should
be easy and even you know, kind of going back
to whether it's we're talking about work ethic or even
when it comes to budgeting, And I mean, I think
it's great to look at some of the different If
you have a current model that's laid out before you
and it's not working, certainly consider something different. But like,
(24:28):
if I think to anything in my life that I
was proud of, it oftentimes took a whole lot of work.
Even as a kid, I can think back to like
coming across some cheat codes on this video game and
you'd enter in the cheat codes and all of a
sudden you got I don't know ninety nine lives or.
Speaker 1 (24:42):
Something like that. There was no like satisfaction there's and
I don't know if beating the game isn't nearly as fulfilling.
Speaker 2 (24:48):
As opposed to like having slogged through with your friends
over the course of weeks and months. I guess what
are your thoughts there, just as far as the and
maybe this is a part of that Protestant work ethic,
but like I would say, an inherent goodness that comes
from the sort of struggle where we are required to
sweat and you know, sacrifice as well, Like that's a
(25:09):
massive part of being able to achieve different goals, and
there isn't the same kind of satisfaction in my view
when you bypass that.
Speaker 3 (25:17):
Absolutely, I think you have to think about what the
purpose is. You know. The video game example is a
really good example of kind of how we approach money
in our culture too, because when you use cheat codes
and you just basically skip ahead, you're considering the purpose
to be beating the game or beating what's the thing
(25:41):
at the end.
Speaker 1 (25:41):
Called the ultimate boss, beating.
Speaker 3 (25:44):
The boss at the end. But that's not really the
purpose of playing video games. The purpose is to you know,
have fun with your friends, or spend the time strategizing
or discovering things in the world of the video game.
If everyone can just jump to the end, then there's
really no reason to have the game. There are other
(26:05):
ways to do that. So I think a lot of
times we approach money in that same way of like,
all we want to do is a mass wealth and
a mass the most wealth and hold on to it
as much as we can. But that's really skipping to
the end. The point of having money is to be
able to live the lives that we want, and if
we're not doing that, then we're really missing out.
Speaker 1 (26:28):
It sounds like you're poking a finger in the eye
of the Fire movement there a little bit, which, oh yeah,
I'm kind of I'm with you on, like, oh yeah,
I think there is that sort of element let me
gather as much under my wings as I can, and
often without the thought process for what a life well
lived looks like. And not that every one of the
Fire movements like that, not at all. We've had a
lot of friends who ascribe to that, and there's some
(26:51):
wisdom I'm gleaned from that movement. But I think, yeah,
you're right, Like, what's it all for is an important
question to ask along the way.
Speaker 3 (26:58):
There's a ton of variety in the Fire movement, and
I think the conversations there are really interesting. It certainly
started with that idea of just make as much money
as possible with as many sacrifices as you can handle. Yeah,
and then sort of branched off where a lot of
people I think, started to see this idea of financial
independence sounds really great, so that they don't have to
(27:20):
work for a living, which is a great concept. But
then they thought, but I don't want it to be
at the expense of my life for five or ten years.
I don't want that to be the only thing I'm
thinking about. And so then we have Slow Fire and
other movements that have come along to kind of expand
that idea, and I think it's bringing up really interesting
(27:42):
things in the way that we relate to money and work.
Speaker 1 (27:45):
I agree. I think, yeah, the healthiest part of the
Fire movement has brought up in the past five years,
and it's been around those kinds of conversations and it's
created different paths towards financial independence and a little less
of an adversarial relationship to work. I think maybe that
was at the beginning that was kind of the moniker,
but that's changed. I want to ask you about debt.
There are a couple of things that you write about
(28:06):
that I think also would be kind of if it
was a personal finance textbook, they'd be like, sorry, I
don't know if we can include that. Right. You talk
about leveraging debt to improve your financial situation, but can't
take me on more debt create more money problems for
people down the road. How do you think about the
role of debt in people's lives.
Speaker 3 (28:24):
Sure, yeah. I talk about debt products as a resource
that's available to you right in line. Like when I
talk about making a money map. There's a column for
your income, there's a column for your assets, column for
community resources you have access to, and there's a column
for debt resources, so credit and loans that you could
tap into. And I think it's really important to see
(28:45):
debt that way, because if we just approach debt with fear,
we could be restricting a lot of times the resources
that we have access to, especially if we're not able
to or for some reason don't want to expand what
we can earn in income using debt. It can help
you live the life that you want to live, or
(29:06):
access things that you need that you might not otherwise
be able to. And we know that we talk about
it with businesses a lot leveraging debt. Almost every business
is based on some kind of debt that they're leveraging
and they're just kind of managing it. Business businesses as
an entity or business owners don't tend to have this
(29:26):
idea of needing to get out of debt as quickly
as possible. It's just kind of one of the resources
available to them. And we don't extend that same grace
a lot of times to individuals, especially working class or
middle class individuals, but we do tend to extend it
to like really wealthy individuals a lot of times. But
(29:48):
we could kind of use it in the same way.
Speaker 1 (29:50):
Why do you think that is?
Speaker 2 (29:51):
That's actually I think that's an interesting point that you
bring up the fact that, I mean everything that you
just said, the differences between an institution or a business
and their ability to take on debt, and it just
hanging out as opposed to how it is that we
as individuals approach our debt typically. Is it because our
finances are simpler? I'm curious if you have a theory
(30:12):
as to why it's more acceptable for businesses as opposed
to individuals.
Speaker 3 (30:16):
I think it's kind of a broad systemic thing. So
when we look at sort of the way that our
financial systems and our sort of society and culture in
general are organized, it's really to favor people who are
already wealthy, individuals who are already wealthy, and to favor
businesses amassing more wealth, and so we give them the
(30:42):
tools to do that. And all of our financial products
and services are crafted through legislation that we create and regulation,
and so those entities are able to appeal to the
people creating those regulations that can kind of shape and
craft those products, and individuals don't have that same kind
(31:04):
of leverage a lot of times to influence that regulation
and legislation. And there's also in that sort of system
where we want to just where wealth is kind of
a mass in a very small sort of portion of
(31:25):
our culture, it doesn't benefit that system to have a
lot of individuals be able to tap into a lot
of resources, because that kind of has to go one
direction in order for those financial institutions to make money
off of us borrowing from them. If we were able
(31:45):
to borrow just as easily. The system wouldn't work in
the same way. So I think it's kind of a
broad sort of critique of our financial systems and of
capitalism that is a little bit beyond kind of what
I get into as a personal finance educator. But when
you're thinking about why do we have that distinction, I
(32:06):
think it's important to kind of ask those systemic questions.
Speaker 1 (32:11):
Another thing you say at one point in the book,
you say, you don't have to pay all your bills,
and that would be like a personal finance one on
one course. It would be like, pay your bills on
time every single month would be the advice given. Why
why do you maybe think that's not quite on point?
Speaker 3 (32:27):
Yeah, And my editor really pushed me because I originally
said you don't have to pay your bills, and she said,
maybe just you don't have to pay all of your bills.
She's oftened it a little, which is probably a good idea.
The idea is less that you can just let your
bills pile up and become overdue, and more of looking
(32:48):
at your kind of living expenses, which we often think
about as fixed expenses, looking at them as more changeable
and considering them as financial commitments that you've made, So
you have to actively make a commitment, which means you
can also choose actively to uncommit from something. So I
(33:09):
mentioned earlier, you know, thinking about how the amount of
money you're putting toward housing in rent or mortgage or
something impacts the other things that you're doing in life.
So if you're living somewhere and regularly paying really high rent,
that is impacting your ability to save for something in
the future, or it's impacting your ability to spend day
(33:30):
to day in the way that you want to. You
don't have to feel like you're just stuck with that expense.
You can get creative. And I share a story in
the book about a couple who was living in LA
with really high rent and they wanted to make a
change in the way that they were working. So their
income was going to be cut way down, and in
order to accommodate that, they ended the lease early on
(33:52):
their LA apartment and they bought an airstream and moved
into that and now are years later, are still living
in an RV and traveling around the country, so they
have much lower cost of living to be able to
accommodate that. So that's a big, extreme kind of lifestyle change.
But I want to encourage people to look at financial
(34:14):
commitments and think about what kinds of commitments can you
cut if you need to, and also sometimes what can
go overdo? What can be left to sit or pile
up or whatever, and what are the consequences if you
let that happen, and can you live with those consequences?
Speaker 1 (34:34):
Like some bills are more important than others, the mortgage
more important than the credit card payment. Yeah.
Speaker 2 (34:38):
Well, and as you are explaining to this, Dana, what
I'm hearing you say too is that, like we have
more agency and control over our finances as individuals than
maybe your chapter headings would make you think that you believe,
which is honestly refreshing, right, Like the ability for us
as individuals to choose, you know what, I.
Speaker 1 (34:57):
Don't giving up the expensive apartment.
Speaker 2 (34:58):
I don't want to live here anymore because this is
an important to me anymore. Like to me, like, that's
the empowering message that I can totally get behind. And
so I guess in a similar vein one of your
chapter headings talks about not needing investment accounts, is there
like a silver ligning that's gonna make Joel and Matt
happy about it, all right, talking about that one.
Speaker 3 (35:18):
Make So the stance that I come into that conversation
with is that investing is by necessity an ethical dilemma,
depending on where your values stand. But where my value
stand is that in order to make money from investments,
(35:40):
the underlying companies have to make a profit, and in
order to make a profit, they need to exploit something
in the equation. So there are exploiting people for labor,
they're exploiting environmental resources, they're exploiting consumers with unfair pricing,
things like that, and that's how we make money from investing.
(36:02):
And so just sort of that underlying system of extracting
capital comes with an ethical dilemma. So I kind of
start there, but then also talk about the reality that
we don't have a strong social safety net in this
country that allows you to age and stop working at
(36:23):
some point very easily if you don't have an investment account.
So the message in that chapter is investing is unethical
but maybe inevitable.
Speaker 1 (36:33):
Do you think exploitation has to be part of it,
or is every business built around exploitation, or could you
reframe it and say that many businesses are built around service,
and they have a duty to serve their customers and
their competition with other people to serve those customers, and
that they know if they want to stay in business
and continue to stick around, they have to please the
(36:54):
people they're trying to reach. Like, do you think there's
an element of that too, or is exploitation kind of
the only.
Speaker 3 (36:59):
Thing you see technically under capitalism, Like if you're getting
into sort of a philosophical place, exploitation is built in
because that's where profit comes from. If a company is
making profits, that money is not going to the people
who created the value necessarily. But that is a technical detail,
(37:21):
and I don't think you need to make financial decisions
based on that. I do talk in the book about
considering investing in local businesses or building your own business,
And there's a lot less of what we think of
as exploitation in the way that those businesses tend to
run because the people who are running them are stakeholders
(37:42):
in their community. They have a much closer relationship with
the workers that are adding value to the business, They
have a much closer relationship with the consumers and the
community that's being affected by it, and so the decisions
that are being made there are going to be a
lot more ethical and you can get a lot closer
or to something that kind of makes sense. The problem
(38:03):
with the way that our systems are set up is
that it's pretty tough to make a retirement plan that's
just based around investing in those kinds of businesses because
you know, we have tax advantages.
Speaker 1 (38:16):
All businesses aren't taking investors most of the time.
Speaker 3 (38:18):
Yeah, yeah, a lot of or building your own business
can be really tough and you end up putting a
lot of money into it and like I said, taking
on a lot of debt rather than just accumulating money
like you could in an investment account. And we also
have again regulation and legislation set up to steer people
toward retirement accounts and investment accounts.
Speaker 2 (38:38):
Well, I think we can agree though that the more
local you get, not to say that there isn't fraud
that takes place on a local level, but just waste, right,
Like the higher up you go and the more global
you know, like not just national but even global, but
something gets like there is a lot more room for
there to be practices that are tough to.
Speaker 1 (38:59):
Tough to get behind. Regig just greater levels of bureaucracy
and overhead and a distance from the customers. Yeah as well.
Speaker 2 (39:06):
Yeah, so I think that's certainly a massive argument for
things more at a local level. But Dandy, you've shared
some critiques with the I don't know more of the
traditional approach to personal finances, but we'll get to some
of the different alternatives that you mentioned in your book
as well'll get to that more right after this.
Speaker 1 (39:30):
All right, we're back. We're still talking with Dana or Randa.
Her new book is you Don't Need a Budget, and
that I think it, Matt, When you first read the
headline or where you first read the title of that book,
you cried, a single tier. A single tier went down
your face because you love budget so much. Me, I
was like, I kind of agree with her, but I
think I think it's situationally dependent at least. And data
(39:50):
one of the things you talk about in your book.
You say that the head, the heart, and health should
be motivating factors for how we make financial decisions. Do
you think that traditional personal finance advice minimizes those elemental
parts of who we are?
Speaker 3 (40:08):
Very much? I do. Traditional financial advice I think focuses
very much on the head, which is your sort of
more financial goals, the numbers, the spreadsheets, the way that
you're thinking and making decisions. It's very much focused on
just that part and minimizes a lot of times heart
(40:33):
and health and heart is what I think of as
like your passions and your values and sort of the
core of who you are and your health is your
best interest living life in a way that supports your
physical and mental and social health. And we've sort of
moved in recent years, maybe in the last five or
(40:55):
ten years, to focusing a little more on financial wellness
and thinking about how our financial decisions have that impact
on the heart. We think about choosing work that we're
passionate about. We think about how we can use money
to support joy and peace and ease in our day
to day lives, and not just towards amassing the right
(41:19):
amount of wealth in the right amount of time or
something that's very head focused. But I still see that
we don't think much about our health, our physical and
mental health and well being in the way that we
teach personal finance. That kind of is still left out
(41:39):
of the conversation.
Speaker 1 (41:41):
It's almost like someone needs to start a healthy, rich
substock or something like that.
Speaker 3 (41:45):
Yes, Yeah, someone needs to get that conversation going.
Speaker 1 (41:47):
Someone needs to jump on that ur L. That's the
name of Data's site. You know what.
Speaker 2 (41:53):
Like, what keeps standing out to me, I guess is
the fact that a lot of what you're saying we
actually do agree with, as far as maybe the mechanics
right or in this case, the way you're framing it
here the head, like how the numbers work, this is
how interest works. This will you have more money or
less money at the end of the day if you're
doing X, y Z. But it's almost as if the
(42:14):
general mindset, like the overall attitude towards how you're thinking
about your relationship to money. It's like maybe that's what's changing.
Do you think that that's an accurate way to maybe
summarize some of the different approaches to personal finances out there?
Speaker 3 (42:27):
Yeah, definitely, all three of those things are important. I'm
not saying that we're currently focused on the head and
we need to move into you know, heart and health,
but that you have to consider all three of those
elements of financial wellness and rather than just focusing on
the advice that helps you achieve specific financial goals, so
(42:50):
it's important to see all of those layers in the
financial decisions that you're making and to understand what you
need to support all of those elements of your well being.
Speaker 1 (43:01):
Daniel, you've levied some critiques against the system, right, and
I think we're particularly talking about the American system of
economics capitalism in particular. I'm curious, though, when you look
at the numbers. We live in the most prosperous country
in the history of the world, and there is I
think a reason that people are lined up to immigrate
to the United States. Typically that's because they believe it's
(43:23):
the land of opportunity. They have more ability to move
up and down the income spectrum. Typically move up the
income spectrum from wherever they are coming from, they have
a chance at a better life. I even heard someone
the other day who's from Canada and they said the
best move I ever made was coming to the United States.
And I was like, Oh, that's really interesting because it's
not like Canada is not a prosperous country. You have
(43:45):
a lot of opportunity there as well. So I'm curious.
I guess when you see that and you see that
there's a lot of people who want to come here
and see this as the land of opportunity. What does
that say to you? I guess about the system and
how other people perceive it.
Speaker 3 (43:58):
We have a really effective story in the United States
about the opportunities that people can have under capitalism, and
that continues to motivate people to essentially feed that that
system and do things like support tax cuts for the
(44:22):
wealthy or something because of promises that are made under
the system. But more and more, as we move through history,
more and more the decisions that we're making are making
that kind of mobility harder. And I don't have I
don't have the numbers behind this in my head, but
(44:43):
it is getting harder since you know, about the nineteen eighties,
as we really started changing the way that we regulate
financial products and companies and work. It's getting a lot
harder to have that kind of class mobility that we
lionize in the United States, and the gap between classes
(45:04):
of people is getting bigger and bigger, and so a
lot of that benefit that is part of the American
story is going to a very small percentage of people
in a really kind of profound way, and it's getting
a lot harder for the rest of us, like the
vast majority of us to really be able to tap
into that, and so we're kind of actually stuck without
(45:28):
a ton of mobility. We're sort of stuck in wherever
we whatever kind of class we were born into.
Speaker 2 (45:35):
I think when you look at home, affordability, that's something
that probably I bet a lot of folks look to
as like, man, my parents and my grandparents, they all
have the ability to afford I guess at the time
the housing boom, like they're all the ranges that were
being built, so like everybody had the ability to buy
their own home. But still I can still not think
of a country I'd rather live than myself, even with
the US and all of its flaws and all the
(45:58):
flaws that capitalism has, I mean, certainly not perfect, but man,
it's tough for me to look past like the innovation
that takes place here in the US, Like even like
healthcare as busted of a system we have, Like if
folks are looking for like the very best health care,
like when it comes to you know, just think about
vain know the vaccines that we were able to roll
out and stend out to the rest of the world.
But even certain things like it makes me think of
(46:19):
like cancer research and treatments, like people come from all
over the world because of I certainly don't want to
make an argument for that. Our healthcare system.
Speaker 1 (46:27):
Is it only costs twice as much as every other
developed country, and what could be wrong. It is not
perfect by any stretch of the imagination, but we are
because of the way we're structured. We are incentivizing the
cures for a lot of these diseases and treatments for
a lot of these diseases that aren't getting made anywhere else.
And so in some ways, some of these other countries
are riding our coatails. And so there's that element too.
(46:50):
So I don't know what to do to fix a
busted system, but I feel like, Dana, you pointed out
some of the flaws incredibly well, and specifically some of
the flaws out of the ways that we think about
personal finance. Your perspective is an important one. So thank
you so much, Dana for joining us on the show today.
And where can our listeners find out more about you
and your new book?
Speaker 3 (47:11):
Yeah, thanks for having me, and I also really appreciate
you being willing to have the conversation and look at
that kind of counter countercultural perspective. So you can find
out all about the book at youdn'tneedabudget dot com and
you can follow me on substag or to subscribe through
email to healthy Rich at healthy rich dot co.
Speaker 2 (47:34):
Heck, yeah, we'll make sure to link to all that
in our show notes as well. Dana, thank you so
much for speaking with us today.
Speaker 1 (47:39):
Yeah, thanks for having me all right, Matt, that was
a really interesting conversation with Dana. Miranda and I think
she comes from a different perspective than you and I
typically do, but we wanted to hear from her, and
I learned a lot talking to her, and I really
loved kind of reading her book and hearing her approach.
I'm curious, what was your big takeaway from this conversation. Well, say,
(48:00):
I was encouraged.
Speaker 2 (48:01):
I guess Towards the end of the conversation, I realized
that it seems like we've got more in common than
maybe the title of her book or the chapter headings
in her book might make you think. And when she
was talking about choosing what bills to pay, you can
have those clickable headlines, Matt and I totally understand that.
But when she was talking about certain bills being more
important than others. Like the root of what she was
(48:23):
talking about and what she said was that, like, you
have actively committed to taking on this financial obligation, this expense,
and you can actively uncommit to doing that too. And
so what is at the core of that is autonomy,
an agency, and an ability for us as individuals to
choose how it is that we want to live our life,
as opposed to being like taking a more passive approach
(48:44):
or posture towards your our personal finances where we're counting
on the government to bail us out or to take
care of this, or for somebody else, or not even
the government, but even like some nonprofit where we're just
sitting on the sidelines waiting for them to come along.
Speaker 1 (48:57):
And sometimes that's necessary, right, There is not a hard times.
There is a.
Speaker 2 (49:01):
Place for organizations like that, for churches, for just some
of the systems that we've even set up through our government.
Like I'm not I'm not one to say to burn
it all down in that we need to be completely
abolishing our garment. I'm not advocating for anarchy. Matt doesn't
want kids to school lunches. We need we need rules
for our government with the kids eat, I say, Matt.
Speaker 1 (49:22):
To function, but I guess yeah.
Speaker 2 (49:24):
I wanted to highlight the fact that I was encouraged
that at the end of the day, we do have
power to direct our lives, not only by what we
choose to do, but what it is that we choose
to spend our money.
Speaker 1 (49:34):
On and what we choose not to spend our money one. So,
I think my big takeaway was when we were talking
about debt and she was talking about nuanced in Shades
of Gray in how we think about debt and which
debts we choose to pay off and win. And I
think there's a lot of wisdom in that this is
something I think maybe she comes at it from a
slightly different slant than you and I do, but I
think she's spot on like you and I are.
Speaker 3 (49:55):
Not.
Speaker 1 (49:56):
Debt is bad. Payoff debt as quickly as possible, short
of people. Some debt can be good debt. Some debt
can actually fuel your financial journey at times. I think
if we be really really careful, because there are a
lot of nefarious forms of debt that can derail your
financial journey, they might get you something that you want
now that maybe you should have waited for and saved
up for. But there are other times where taking on
(50:19):
a measured amount of debt can help you make more progress.
So just maybe we need a more nuanced discussion about debt.
That's something we try to do here on the show. Yeah,
and we always have Yeah when people ask us questions
about it. Well, yeah, don't take out a personal loan.
Personal loans suck. Credit card debt sucks. But then there
are other forms of debt that can be beneficial to
your ultimate ability to earn more, to buy a house
(50:42):
that you don't have, you know, cash to pay for
the full thing for, like a mortgage can make sense, right,
So just be thoughtful about debt, but maybe don't rule
debt out of your life altogether. Totally.
Speaker 2 (50:53):
Yeah, this is one of those instances where I feel
like we are in the extreme middle. We're kind of
like refereeing a fight between Dave Raims and Dana Miranda
when it comes to different things like this. But yeah,
in the end, certainly glad that we were able to
spend a minute and talk with Dana Miranda. Joel, Let's
get to the beer that you and I enjoyed during
this episode, which was a silent accord is what this
(51:16):
was by Six Bridges brewing out of John's Creek. And
I don't know if you've ever had a beer by
these guys on the show is different Georgia or Atlanta
suburb And no, I don't think I ever had any
beer by these guys.
Speaker 1 (51:30):
But I picked this one up, saw it on the shelf,
and I was like, that looks interesting. And this to me,
I like the Matt label. Yeah, it makes me want
to scratch up with my fingernail. This beer reminded me
of a beer by another local brewery, Creature Comforts. They're
Cocoa Bunny. Oh, because it's got the coconut and vanilla
thing going on in This is in a milk stout.
They do a milk porter, but this is a milk porter. Yeah, Okay,
(51:53):
this is good, but Coco Bunny's better think so. Yeah,
it's just got such good roasty like this.
Speaker 2 (51:59):
Is the kind of beer that you can enjoy in
the afternoon, like after lunch, if you're wanting some of
those coffee like flavors but you're afraid of like getting
that ninety milligram hit of caffeine this close to your bedtime.
That's what's going through my head at least when I'm like, yeah,
I really shouldn't have any coffee this afternoon because it's
gonna impact me instead, that's when you reach for a
delicious stout like this.
Speaker 1 (52:19):
So I need to do more research on this. But
I've read that coffee impacts people differently based on their genetics,
and I'm pretty I'm pretty sure I'm one of those
people who coffee doesn't have nearly as much of an
impact on as others.
Speaker 2 (52:30):
Or maybe it's because you sleep so poorly all the time.
That could be that, Like your body's just like extra
hit of caffeine.
Speaker 1 (52:37):
That's nothing, all right, But we got a jet for now.
That's gonna do it. For this episode. We'll put links
to Dana's book into her substack in the show notes
up on our website at howtomoney dot com. You know it.
That's gonna be it, though, So until
Speaker 2 (52:51):
Next time, best Friends Out and best Friends Out
Hosts And Creators
Joel Larsgaard
Matthew Altmix
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