WEBVTT
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Get ready before life happens, the podcast helping you navigate life's blood.
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What if every purchase came with one simple question?
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Does it make sense?
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Welcome to Get Ready Before Life Happens.
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I'm pleased to be joined today by my friend Karen Holland.
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Aaron, welcome back to Get Ready Before Life Happens.
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Oh, thank you, Tony.
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I'm so happy to be here.
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Yeah, I'm glad to have you on as you've developed a really cool resource called the Does It Make Sense Calculator, which I mean, you know, you and I have talked about it.
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I'm a huge fan of.
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And I hope after listening to this episode, everybody out there is going to, you know, check it out and hopefully it can make a difference for them, like I think it will.
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So, Karen, tell us a little bit about yourself.
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What is your origin story and how did it lead you to focusing on helping young people to think before they buy?
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Well, it was super organic, not on purpose.
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Um, I'm one of three girls.
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Our mother was a kindergarten teacher, uh, whip smart kindergarten teacher.
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And before the summer before eighth grade, she had us make a list of everything we would need for back to school.
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And we were like, oh, this is amazing.
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So we thought we made this like super comprehensive list.
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You know, we really went to town and um and we had to give a number for everything on the list.
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And then uh my mom tallied it up, divided it by the 10 months of the school year, and she gave us a check.
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Kids, that's a piece of paper you take to the bank that lets you get a certain amount of money out.
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She gave us a check for the first day of every month, and we had to buy everything.
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So she was giving us the purchasing power.
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And when it first started, I remember that September, like yesterday.
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I mean, I I've said this to other people before, but I mean, and I have a twin sister, Kathy, and I were so we were like, why are we even going to school?
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We're loaded.
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It was$79.
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We got$78, which you know, you think like that was a lot of money.
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I'm old.
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Of course, my mother was so smart, she knew that list was not comprehensive.
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It did not cover everything.
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And guess what?
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We got really good at quick making trade-offs because you knew that if you bought one thing, you know, you were trading future purchasing power.
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So, fast forward, I have my own family.
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I spent 12 years on the sidelines of baseball and hockey games.
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You're going to all these tournaments, you know, you're spending every weekend with the same family.
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We parent in tribes, and it's becoming obvious that um other families don't have this same sort of simple structure in place for spending, which is asking, you know, does this make sense?
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Is this something that I'll still want next week?
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Um, am I confusing short-term excitement with lasting value?
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Do I understand the full cost, not just the price tag?
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Um, and you know, certainly relevant for today's kids.
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It was less so then.
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My son's a man now.
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Um, have I really thought this through or am I just clicking by?
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So uh, you know, I just started asking my friends' kids these questions.
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And by the time Matt went off to school, people were saying, go talk to Karen.
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And then I I wireframed the site because I just saw how helpful it was.
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There's a there's a very, he's sort of an iconic um financial reporter.
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Robin's spoken about him before, uh, Rob Kerrick.
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And he said, What are you really doing, Karen?
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What are you doing?
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And I said, I'm I'm just slowing them down.
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Just slowing them down.
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Because when we take a beat, we make better choices.
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And the problem, Tony, is that today's environment has been engineered to remove all the helpful pauses that you and I grew up with.
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Yeah.
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And you and I have had that conversation before.
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It's about the friction.
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So, you know, that's the friction of when we were young is, you know, if you wanted something, you had to get money out of the bank.
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The bank, you know, was you know, was wasn't open every day, all day.
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And then you had to go somehow get yourself to whatever store it was.
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I'm thinking records or comic books in my case, and then the store had to be open, and then you had to have enough cash to buy it, then it took some work to make a purchase.
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And now it's like Amazon's got the buy it now button, and then you have it an hour later.
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And the and the thing is, friction is not all bad.
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It creates resilience.
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Like, think about how we engage with friction purposefully to be fit because we know that's going to make us stronger.
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So why are why are we removing it and all of these other facets of life?
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And I I just I'm not sure.
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I think for you know, parents who who it's we've got very few parents today who didn't grow up with any friction, but their children are digital payment system natives, and it is so frictionless.
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And I think that, you know, it's it's very hard for us to understand how powerful, you know, algorithmic persuasion is.
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It's embedded in every platform that teenagers, young people, not to mention ourselves, I mean, we use we use these things every day, right?
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And these are not benign neutral tools.
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And so the young person who is arriving in this environment without a practiced habit of reflection, it's actually much harder for them to be thoughtful about how they spend.
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It really is.
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It's not their fault.
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Yeah.
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And we've I've gone through that with my son, is you know, because it, you know, and and I try to tell him is look, this stuff is designed to get you to buy, and they have these limited drops and you know, all of these other things.
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And it's just it's just constantly at them.
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And it's like you said, it's so easy to do.
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So, like, you know, what tips do you have for parents who are going, my gosh, how do I even begin to give my kid a sense of friction?
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It's interesting.
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Just last week, a parent made a comment to me, and I was like, I've I've heard it before, but they just said it really succinctly.
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And it's basically that the doesn't make sense score calculator is asking questions that they have asked, but you don't get to'd or you don't, as a child, you don't give attitude to the doesn't make sense score calculator.
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You just answer the questions because you know there's method to the madness, right?
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You want to get to the score, you want to produce that charitable summary, you want to sit down and have a conversation with your parents about possibly moving this purchase from wish list to reality.
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And um, and the and the phrase I thought it was hilarious was ophthalmalic calisthenics, that you know, the DIM score calculator doesn't get any eye rolls, no ophthalmalocalisthenics from the kids.
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Um it really is as simple as slowing down, or I, you know, we use a lot of driving metaphors.
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I mean, I I think that what we're missing in society at large is spending ed, right?
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We have driver's ed.
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We don't just hand teenagers car keys and hope for the best.
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We give them structured practice in lower stake settings before the consequences can get serious.
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Why not do the same with money?
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And similar to driver's ed, spending ed is not the final destination.
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It's the trip preparation that helps the future unfold the way we want it to, right?
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I mean, I think one of the reasons that um we've been so successful in partnering with other organizations is they know that we're not doing anything duplicative.
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We're not competing with what they're doing, we're helping their work land more powerfully because we're giving kids this lived experience of getting and using financial information to help them make decisions that they're happier with, not just in the short term, but in the long term.
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And they, you know, it doesn't take very much distance to be able to take a backward glance and go, wow, I really I spared myself, my family.
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That was great.
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And then of course, success is tasty.
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So once you discover that you can get and use financial information quite easily to help you make good decisions, well, why would you ever stop?
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Yeah, no, that that's so good.
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And you know, what you said is, you know, thinking helps you make decisions to happier with in the long term, is because you know, I I'm sure everybody out there has had that feeling where you've bought something, you go, what was I thinking?
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Literally, why did I buy that?
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Yeah, you know, but it it it's when that rushing in, and it is hard to take a beat, but when you do take a beat, you can oftentimes pull yourself back.
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And it's something that I've talked about on some of my podcasts with people when we're talking about scams and frauds, that that is one good one thing that fraudsters try to get you to do is to make that decision right now under pressure, which is kind of how a lot of these things are presented to our kids, is like, you got to make this decision now.
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You can't wait.
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I mean, that's that's a huge red flag.
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I know we've had this conversation before.
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Pressure is a huge red flag, right?
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I mean, anybody who's putting pressure on you does not have your best interest at heart.
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They should want you to feel like super comfortable.
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I mean, uh, one of the things, and and uh Rob again really liked this phrasing is I like to tell kids and families and school administrators, we are not in the feel bad about spending business.
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We're in the think more about spending business.
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And one uh question we ask in workshops is what's a purchase?
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So I'll ask this to you, Tony.
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What's something that you bought that you're like, hot damn, that is the best money I ever spent.
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I use that thing all the time.
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It's been so helpful, it's lasted forever, you know, it worn like a bullet.
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Like, what's some purchase that you just it was great money spent?
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Oh boy, thinking off hand is you know, I'd say one of my cars, but the reason is that my car is over 15 years old.
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So I got the maximum value from it instead of buying a new car every two to three years.
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Is that's that's a great budget helper for anybody.
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Well, so that feeling, that feeling of knowing that you spent money well and it was and it's really been a great purchase, that's the feeling I want kids to have for most purchases.
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It's not possible to have them for all purchases.
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And of course, we learn from missteps, but I want you to, I want you to have that confidence and that excitement and that deep satisfaction for most of your purchases.
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And what's so powerful about that is that it preserves future purchasing power.
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Because when you only buy things that you'll actually use and appreciate, that you take care of, almost by default, you create future purchasing power because you stop buying things that are underappreciated, underutilized.
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Yeah, I I love that, Karen.
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You know, that that when you are buying things, it is you don't have a feeling because you know, when you're just buying sort of random things and not thinking about it, is you don't have any satisfaction.
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And you end up not using a lot of the stuff that you buy, uh, which is the other thing is, you know, it's a very short-term, I guess, what is it, adrenaline?
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Would it be adrenaline?
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Dopamine.
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I think they dopamine.
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That's they say, well, I will tell you, I mean, we we underscore most kids expect with, oh, they're coming to a thinking before buying workshop or a mindful spending workshop, they're like, oh, you know, do I really want to learn how to um save money?
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Maybe it's not doesn't strike them as so interesting.
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I mean, one common piece of feedback we get is, oh, that was so much better than I thought it was gonna be.
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And I'm like, great, I'm so glad.
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Um it's not about deprivation, right?
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I mean, when you when you here's let me put it to you another way.
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I think the question we should be starting with is does it make sense?
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Not can I afford it?
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Because if something makes sense in your life, you're gonna figure out a way to make to be able to afford it, right?
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Because you're like, this is gonna reduce my commute, make my day-to-day better, you know, let me have hot lunches, let me feel good when I'm running, whatever it is.
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So if a purchase really fits your life well, if you're really gonna use and appreciate it, then then you're going to figure out a way to be able to afford it.
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So does that make sense when I say I almost think like the the first question should be does it make sense?
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Does it fit your life?
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And then, and if it really does, and maybe it takes months, sometimes years to afford it, but it's also it's so much easier to give up other purchases when you know, like there's your North Star, right?
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This is the thing I want.
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So, for example, many kids this year are Jonesing for World Cup tickets.
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First time the World Cup's gonna be in Canada, Mexico, and the US.
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And so it was very easy.
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We had this little um visual goal tracker, the worth the weight goal tracker.
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They put it on the fridge.
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And so, you know, you're eating your cereal in the morning before you go to school and you see that goal tracker, and maybe a friend says, Oh, let's go get a slice or a latte.
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Well, you can go and be social, but you might say to yourself, Well, I'm not gonna spend$10 on snack food after school because I know I'm only$10 away from those tickets or the jersey or the jacket you want, whatever it is.
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So spending with a plan, you know, it's right on our homepage, is fun and worth it.
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And I know some people are like, right.
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And I'm like, it totally is.
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It totally is fun and worth it because you actually get the thing that you know you will use and appreciate.
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And it is deeply satisfying to be able to do that.
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And and what are we really doing?
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We're showing kids that they have agency.
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That's what this is all about, right?
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Well, I think all of us have agency.
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And actually, I'm thinking about does it make sense in the, you know, in respect to my calendar, is you know, time is one of our most valuable assets.
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And we're often very free with our calendars, but that spends our time.
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Um, you know, I don't know how some people do it where they have their, you know, their calendarly, and it's like they're they have slots open from eight to five every day of the week.
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And I'm like, holy cow.
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Oh no, actually, that's not me.
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Actually, sometimes people are like, there isn't there's nothing for like six weeks.
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And I'm like, well, you know, I'm in schools or I'm I'm doing whatever.
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And actually, I know one gentleman in the UK, he specifically slots out like a chunk every day for deep thinking.
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So I agree with you.
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That's that's one of the ways you should think about does it make sense for sure.
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Yeah.
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Yeah, I love it.
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I I know it's not the intent, but but when you say does it make sense and can it be applied everywhere?
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I I am wholeheartedly on board with that.
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So, Karen, you know, one of the things you know that we talk about is pausing before making a decision.
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So, why is that pause so important before making a financial decision or just any decision at all?
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Because prices, the sticker prices of things, just never reveal the full cost.
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And it doesn't take a lot of time.
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I mean, the doesn't make sense score calculator is quick, but not arbitrary.
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So it doesn't take a lot of time to reveal, you know, I put them into two categories.
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You have ancillary costs and phantom costs.
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So ancillary costs are the things that it doesn't take too much time to realize.
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For example, you're going to a concert, either you've got to take the subway there or pay for parking.
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So that's an example of an ancillary cost.
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But a phantom cost might be, you know, you buy a rainbow loom and you're not really thinking about the fact that once you go through the initial package of elastics, you need more elastics to be able to keep looming.
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So when you pause and answer the questions, and you know, Tony, there's you know, no liver transplants, it's not multivariable calculus.
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These are very straightforward questions.
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You know, how often are you going to use it?
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Can a sibling, a younger sibling or a cousin use it when you're done with it?
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Um, if you're buying, you know, sports equipment to try out for a team.
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Sometimes coaches know where you can borrow the equipment before you know you make that big commitment.
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So it really, it's it's like two to five minutes.
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Just answer these questions, but it helps you understand the full on-time delivered cost of what it is you're buying.
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And that is a very different number than the price tag.
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And I mean, things like buy in, buy now, pay later, which I know you and I'm not, we're not fans.
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Um, you know, that that cuts the cost in four, which, you know, totally, and there's four reasons that we experience buyer's remorse.
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We overestimate use, we underestimate cost, we mistake short-term excitement for lasting value, and uh, you know, we just act too quickly.
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So buy now, pay later exacerbates all three of those.
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The only one it doesn't exacerbate is underestimating um overestimating use, sorry.
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But you underestimate cost, it accelerates your decision, right?
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It lets you mistake short-term excitement for lasting value and it totally reduces friction.
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So it's just pausing is it's like a superpower.
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I mean, it's free.
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Anybody can take a beat.
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And I almost can't think.
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I mean, I guess if a train's rolling down the track, don't pause.
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Just go on instinct.
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But when you're shopping and you're buying something, take a minute.
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Just give yourself a minute.
00:17:48.400 --> 00:17:51.039
It is, you know, there's a reason we're called gifting sense.
00:17:51.119 --> 00:17:52.160
It is a gift.
00:17:52.319 --> 00:17:53.039
It is a gift.
00:17:53.200 --> 00:17:59.440
Developing this habit of pausing, gathering information, and reflecting before you spend your money or anybody else's.
00:17:59.519 --> 00:18:02.319
Because if you're asking for a birthday or a holiday gift, that's what you're doing.
00:18:02.400 --> 00:18:04.400
You're asked somebody to spend money.
00:18:04.720 --> 00:18:07.920
Just take a beat and you won't be disappointed.
00:18:08.079 --> 00:18:13.759
The people who care about you won't waste time and money running around buying things that you don't want, anyways, won't use and appreciate.
00:18:13.839 --> 00:18:18.400
And then, I mean, we could talk for an hour about the environmental consequences.
00:18:19.759 --> 00:18:20.000
Yeah.
00:18:20.640 --> 00:18:25.200
So, so Karen, take us through, you know, a full calculation.
00:18:25.359 --> 00:18:29.279
Maybe let's talk about going to a concert.
00:18:29.440 --> 00:18:37.839
You know, talk talk us through, you know, the process that somebody would go through with the DEMS calculator and thinking about going to a concert.
00:18:38.559 --> 00:18:44.480
Um, okay, so I first want to say that when we talk about a process, I mean, let's be clear on screen.
00:18:44.640 --> 00:18:47.599
I mean, the very first time you go through it, maybe it's five minutes.
00:18:47.680 --> 00:18:49.920
And then every time after that, it's like two to three.
00:18:50.079 --> 00:18:51.599
So we'll call it a process.
00:18:51.759 --> 00:18:54.400
And it it is quick, but it is not arbitrary.
00:18:54.559 --> 00:18:57.759
So it's really split into, I would say, three parts.
00:18:57.839 --> 00:18:59.599
So the first part is just the numbers.
00:18:59.680 --> 00:19:04.240
So like the actual price, if it's relevant, sales tax, shipping.
00:19:04.319 --> 00:19:05.599
So you wanted a concert.
00:19:05.680 --> 00:19:10.640
So you need the ticket price, which often includes um all of these fees, right?
00:19:10.799 --> 00:19:11.839
Venue fees.
00:19:12.000 --> 00:19:15.839
And then you move to, okay, well, how much does safe transportation cost?
00:19:16.160 --> 00:19:19.440
You're gonna want something to eat and drink, right?
00:19:19.519 --> 00:19:24.400
And very few venues allow outside uh food and drink in the venue.
00:19:24.559 --> 00:19:28.799
Actually, that was one interesting thing we discovered when we launched in the United Kingdom.
00:19:28.960 --> 00:19:34.960
They do allow you to bring brown bag lunches, which for families would be fantastic, but that's not the case in North America.
00:19:35.279 --> 00:19:38.720
Often, if it's your first time, your seminal concert, right?
00:19:38.880 --> 00:19:41.039
You want um a souvenir.
00:19:41.200 --> 00:19:43.200
So, okay, what is that gonna cost?
00:19:43.519 --> 00:19:50.079
And then, you know, what if what if something happens and all of a sudden you can't take uh the subway home, you have to take an Uber?
00:19:50.160 --> 00:19:52.079
You know, you just have to plan for all of these things.
00:19:52.160 --> 00:19:55.359
So the first part is just understanding the numbers.
00:19:55.599 --> 00:20:00.319
And uh then the second part is thinking more deeply about how this purchase fits into your life.
00:20:00.400 --> 00:20:04.480
So the number one question is do you know when and where this event takes place?
00:20:04.640 --> 00:20:06.079
And kids are like, well, why do we have to know that?
00:20:06.160 --> 00:20:13.279
And I'm like, well, first of all, everything depends on the date, like the cost of transportation, when the concert is, are you gonna have to miss school?
00:20:13.519 --> 00:20:20.000
Missing school isn't necessarily a deal breaker as long as you have a plan in place to make up for the missed work.
00:20:20.160 --> 00:20:22.640
But again, that's information that your parents need.
00:20:22.720 --> 00:20:25.039
Like our whole life is making the case, right?
00:20:25.119 --> 00:20:32.480
You have to make make the case to your employer, uh, make the case to your spouse when you're trying to decide if you should purchase something.
00:20:32.640 --> 00:20:36.960
So it's it's really exercising that make your case muscle.
00:20:37.200 --> 00:20:42.160
And of course, the exciting thing is when kids go through and answer those questions, they stop themselves.
00:20:42.240 --> 00:20:44.319
They're like, oh, well, wait a minute.
00:20:44.640 --> 00:20:49.759
This is, you know, for example, Super Bowl tickets, this is much more money than I appreciated it was.
00:20:49.920 --> 00:20:53.599
So I want to recalibrate and and maybe think about doing something else.
00:20:53.759 --> 00:20:55.119
So the first part is math.
00:20:55.279 --> 00:21:00.880
The second part is thinking about, you know, how hard is it to execute, like how hard is it to get there?
00:21:01.119 --> 00:21:09.599
Uh, one question that's in every does it make sense score calculation is does this purchase tell the rest of the world what you want them to know about you?
00:21:09.759 --> 00:21:12.799
Which is our euphemism for is it values aligned?
00:21:12.880 --> 00:21:19.599
And we define values for kids as the ideas and beliefs that your family uh upholds.
00:21:20.319 --> 00:21:24.400
So that can that can be where people stop themselves, right?
00:21:24.480 --> 00:21:26.720
And we use funny examples in workshops.
00:21:26.799 --> 00:21:31.200
Like I always so Tony, what's an what's a vegetable you don't enjoy eating?
00:21:32.559 --> 00:21:33.519
Uh tomatoes.
00:21:33.680 --> 00:21:35.119
Well, actually, tomatoes is a fruit.
00:21:35.920 --> 00:21:36.160
Okay.
00:21:36.559 --> 00:21:37.599
We'll just go with tomatoes.
00:21:37.839 --> 00:21:38.960
Okay, we'll go with tomatoes.
00:21:39.039 --> 00:21:40.160
So good news, Tony.
00:21:40.319 --> 00:21:42.960
Next weekend there's a tomato festival two minutes from your house.
00:21:43.119 --> 00:21:43.839
Are you going?
00:21:44.559 --> 00:21:45.440
Nope.
00:21:46.079 --> 00:21:50.240
Okay, well, what if all your friends were gonna be there?
00:21:50.960 --> 00:21:53.039
It's a tomato festival, no chance.
00:21:53.359 --> 00:21:55.759
Okay, well, you can even think about it.
00:21:56.000 --> 00:21:59.519
Right, you have a sense of self, but sometimes kids will be like, well, I'm gonna go.
00:22:00.079 --> 00:22:02.319
I'm just not going to eat tomatoes because they're not my jam.
00:22:02.480 --> 00:22:11.279
But here's the problem: then a week after you went to the tomato festival, you're going to a friend's house for dinner, they're planning the menu, and the older brother is like, I saw Tony at the tomato festival.
00:22:11.359 --> 00:22:15.839
So let's have cumulative tomato soup, toasted tomato sandwiches, whatever it is, right?
00:22:16.000 --> 00:22:19.440
So the you know, social media is an issue for lots of reasons.
00:22:19.599 --> 00:22:25.039
But one of them is when we buy something or go somewhere, it's it's not private.
00:22:25.599 --> 00:22:28.640
So it's it's telling the rest of the world something about you.
00:22:28.799 --> 00:22:30.799
So, you know, we try to make it funny.
00:22:30.960 --> 00:22:34.960
A closer real word example would be um downloading music.
00:22:35.039 --> 00:22:37.119
You just like the way it sounds, the rhythm and the beat.
00:22:37.200 --> 00:22:49.279
You're not paying any attention to the lyrics, which could really contain words that hurt somebody else's feelings, or you know, you put a sticker on a long board or a binder, you like the color, the shape, maybe it has a symbol who hurts somebody's feelings.
00:22:49.440 --> 00:22:53.759
So we're like, it's the actually the last question in every does it make sense score calculation.
00:22:53.839 --> 00:22:59.039
And we're like, is this purchase, is this event telling the rest of the world what you want?
00:22:59.279 --> 00:23:03.599
So then you answer the questions, we distill those answers into a score out of 10.
00:23:04.319 --> 00:23:24.079
If you can generate a doesn't make sense score of eight or greater, that means you probably have enough information to proceed and have a conversation with your parents or caregivers about moving this possibly purchase from wish list to reality, and you can generate a shareable summary of all that math and thinking, and that's called the DIM score report.
00:23:24.160 --> 00:23:26.480
So those are the three sections.
00:23:26.640 --> 00:23:27.839
Does that answer your question?
00:23:28.000 --> 00:23:37.759
And you know, I I took five minutes to describe it, but I think it really happens very quickly once a young person is used to the platform.
00:23:38.400 --> 00:23:41.599
Yeah, and and you know, I think that's a beautiful description.
00:23:41.759 --> 00:23:43.039
I appreciate you sharing it.
00:23:43.200 --> 00:23:45.039
And I think it's something that we can apply.
00:23:45.200 --> 00:23:47.039
You and I have talked about this to so many things.
00:23:47.200 --> 00:24:01.839
Adults can apply this, is you know, when somebody's talking about buying a new car, I go, well, think about, you know, you have the registration, you have the insurance, which is going to be higher on a new car, you have all these other things that go with it.
00:24:02.000 --> 00:24:05.680
You want to try to avoid the warranty that they sell you at the dealership.
00:24:05.920 --> 00:24:07.599
So I I mean, I don't know if you know.
00:24:07.680 --> 00:24:10.079
We actually we just released a first car.
00:24:10.240 --> 00:24:11.440
Does it make sense for a country?
00:24:11.839 --> 00:24:12.160
That's right.
00:24:12.240 --> 00:24:12.559
I forgot.
00:24:12.799 --> 00:24:18.319
And and it was actually, I mean, it's the that's the most consequential choice that we've helped young people with.
00:24:18.400 --> 00:24:20.000
Before that, it was pets.
00:24:20.319 --> 00:24:23.440
Um it's it's been on fire.
00:24:23.599 --> 00:24:31.119
It's and actually it's so interesting because some somebody wrote to us and said, Oh, this speaks of privilege, a car for a teenager.
00:24:31.359 --> 00:24:40.880
But, you know, in a lot of, you know, rural communities where there's no public transportation, kids are thinking about a car from a very early age on.
00:24:40.960 --> 00:24:42.960
And I mean, we're not talking about a brand new car.
00:24:43.039 --> 00:24:47.920
They're almost always, you know, not just a first second hand down, they're a second, second hand down.
00:24:48.079 --> 00:24:54.640
Uh, but we need these kids to understand, even if you get a fantastic deal on a first car, you're exactly right.
00:24:54.799 --> 00:24:57.440
All of those things, insurance, of course, is a huge cost.
00:24:57.920 --> 00:24:58.880
Maintenance, right?
00:24:59.039 --> 00:25:01.279
Repairs never happen when it's convenient.
00:25:01.359 --> 00:25:02.960
It's always when it's not convenient.
00:25:03.200 --> 00:25:05.680
Gas, that's a topical number, right?
00:25:05.839 --> 00:25:07.440
How much is gas gonna cost?
00:25:07.839 --> 00:25:08.319
Right.
00:25:08.640 --> 00:25:13.440
So it just lays bare all the components of a purchase.
00:25:13.519 --> 00:25:17.119
And here's the exciting thing kids are like everybody else.
00:25:17.200 --> 00:25:22.160
When they see those numbers, they automatically know what does or does not make sense for them and their family.
00:25:22.319 --> 00:25:24.960
Sometimes school administrators are a little reticent.
00:25:25.039 --> 00:25:27.039
They're like, we don't want to put any pressure on our parents.
00:25:27.200 --> 00:25:29.440
And I'm like, you know, I've been doing this a long time.
00:25:29.519 --> 00:25:34.960
I don't know everything, but trust me, kids are so aware of their family situation, they stop themselves.
00:25:35.119 --> 00:25:49.519
In fact, I was in southern San Diego last week at a school, and the school superintendent who brought us into um her middle school, one of her middle schools, was sharing after the fact that she was working with a student who wanted a cat.
00:25:50.160 --> 00:25:55.359
And so they got to the food question, and Liz said, Well, I just bought cat food for my cat.
00:25:55.440 --> 00:25:57.519
It was$40 if for one month.
00:25:57.599 --> 00:25:59.759
So you need to go 12 times$40.
00:26:00.079 --> 00:26:02.240
And like the student stopped right there.
00:26:02.319 --> 00:26:05.519
She's like,$480 just to feed the cat?
00:26:05.759 --> 00:26:06.720
Liz was like, Yeah.
00:26:06.960 --> 00:26:09.839
She's like, Oh, okay, time out, right?
00:26:10.160 --> 00:26:12.799
So it's a it's such a worthwhile process.
00:26:12.880 --> 00:26:16.960
I mean, parents report getting fewer, better quality requests to spend.
00:26:17.200 --> 00:26:20.799
You know, kids feel like they're part of the conversation.
00:26:20.960 --> 00:26:22.319
They have agency, right?
00:26:22.400 --> 00:26:30.720
They're they're discovering, like, the reason it improves family harmony is because it gets all family members singing from the same song sheet.
00:26:30.799 --> 00:26:32.960
All of a sudden, the kids understand what the big deal is.
00:26:33.039 --> 00:26:37.680
I always say most family discord about spending is sort of answering the question: what's the big deal?
00:26:37.759 --> 00:26:38.319
What's the big deal?
00:26:38.400 --> 00:26:39.279
I just want to go to the movies.
00:26:39.359 --> 00:26:41.839
Well, the big deal isn't the$8 movie ticket.
00:26:42.079 --> 00:26:46.799
It's the fact that you need$16 for popcorn and soda and you've got to get there and back safely.
00:26:46.960 --> 00:26:50.880
You know, it's all of these other things that aren't obvious at first pass.
00:26:51.119 --> 00:27:00.799
So slowing down, pausing, using the doesn't make sense score calculator just helps you be aware of all components of a purchase.
00:27:01.039 --> 00:27:05.279
And I promise you, when kids are aware, they make great decisions.
00:27:06.079 --> 00:27:07.599
Yeah, and so do adults.
00:27:07.839 --> 00:27:14.160
And um, for everybody watching and listening, is uh Karen's organization, gifting sense is a nonprofit.
00:27:14.240 --> 00:27:16.400
So the calculator is free to use.
00:27:16.559 --> 00:27:22.559
So um, and there'll be links to it in the show notes so you can go check out the DEMS calculator for yourself.
00:27:22.720 --> 00:27:32.640
So before we start to wrap up, Karen, is what do you find tends to surprise students and or their families the most when they work through the DEMS calculator?
00:27:33.200 --> 00:27:40.480
Um that that kids choose not to spend, you know, that they stop themselves, that's a big surprise.
00:27:40.799 --> 00:27:53.440
Um that it that it isn't about deprivation, that it really is about putting a plan in place so that you have purchasing power for, you know, something that really means a lot to you.
00:27:53.920 --> 00:28:04.799
And I think parents are surprised, you know, it's I mean surprised slash maybe a little frustrated sometimes that geez, this this mindful spending tool is really just asking the questions that I want to ask.
00:28:04.960 --> 00:28:20.160
But when I ask, somehow they land differently and and you know, we end up in an argument versus when the questions are on the screen, I guess it feels more benign or neutral, and um, and the kids just go through and answer them, and then you get to have a relaxed, productive conversation.
00:28:20.240 --> 00:28:22.559
So I think those are the those are the big ones.
00:28:23.440 --> 00:28:24.960
Yeah, I mean, that's the thing.
00:28:25.039 --> 00:28:36.960
There's so much, you know, as we've talked about communication, is uh there's, you know, our words are only just a very small percentage of the communication we give.
00:28:37.039 --> 00:28:49.599
And so when you're talking to your kids about these things, you have all these nonverbal factors, you have the history of every conversation you've had with your kid about money, that all these things come into play.
00:28:49.680 --> 00:28:51.200
So it's not just about the thing.
00:28:51.359 --> 00:29:02.160
And I think that's the value of a tool like DIMMS is that the kids able to engage fully on that, and there's not all these other outside factors uh weighing in.
00:29:03.599 --> 00:29:04.480
I think so.
00:29:04.960 --> 00:29:05.759
I think so.
00:29:06.480 --> 00:29:08.000
Yeah, so I mean, who knows?
00:29:08.079 --> 00:29:08.960
That's just my theory.
00:29:09.119 --> 00:29:12.400
So, you know, I'll Well, I mean, we you know, we hear it, we hear it.
00:29:12.480 --> 00:29:14.559
So it's it's more than a theory.
00:29:16.079 --> 00:29:16.720
All right.
00:29:16.960 --> 00:29:30.319
And the thing is, you know, acquiring this habit early in life closes the financial literacy gap, you know, so upstream of other interventions, right?
00:29:30.480 --> 00:29:36.960
You know, right now we have a lot of systems in place to help people dig out of a pitfall.
00:29:37.039 --> 00:29:43.680
Why not create circumstances that allow people, you know, never never to get into the pitfall in the first place?
00:29:43.759 --> 00:29:46.960
It's so much easier to avoid it versus dig out.
00:29:47.119 --> 00:29:58.559
And so when you learn early, pause, gather information, and reflect before you make a decision, you have a much easier time of avoiding, you know, what are very typical pitfalls.
00:29:58.640 --> 00:30:00.000
I mean, you're not alone.
00:30:00.480 --> 00:30:04.559
You know, the reason they're called pitfalls is because they're typical, not because they're atypical.
00:30:05.200 --> 00:30:06.000
Yeah, yeah.
00:30:06.079 --> 00:30:07.200
No, that's that's wonderful.
00:30:07.279 --> 00:30:12.319
And I love that is that it is easier just to avoid something than to dig yourself out.
00:30:12.480 --> 00:30:14.000
That's that's a great word.
00:30:14.079 --> 00:30:17.519
So, Karen, to wrap up, I have what's called the Get Ready Hot Take Trio.
00:30:17.759 --> 00:30:21.200
These are three quick questions to ask all of my guests.
00:30:21.440 --> 00:30:21.680
Okay.
00:30:22.000 --> 00:30:27.680
The first one is what's one myth about spending money that you're trying to break?
00:30:29.200 --> 00:30:35.519
Oh, well, just that mindful spending is is about um is is about not getting.
00:30:35.680 --> 00:30:36.799
It's not about not getting.
00:30:36.880 --> 00:30:44.000
It's about ensuring that you're able to buy what will really improve your life, make you happy.
00:30:44.400 --> 00:30:45.839
It's not about deprivation.
00:30:45.920 --> 00:30:48.960
It's it's really plan beats no plan every single time.
00:30:49.119 --> 00:30:52.640
And planned spending helps you get what you really want.
00:30:54.960 --> 00:30:56.000
And get what you really want.
00:30:56.160 --> 00:31:18.160
I'm just making a note is you know, that is, I think, really powerful that this is not a negative tool, this is a positive tool so that you can uh get the most value from your money is you know, while you know you don't have a scarcity mindset, is sometimes there is a finite amount of money that you have available to spend.
00:31:18.319 --> 00:31:26.319
And spending your money wisely allows you to have more money to save and to invest, and as you said to be happier.
00:31:26.480 --> 00:31:29.440
So, Karen, let's get out the time machine.
00:31:30.000 --> 00:31:38.960
If you could go back in time, knowing what you know now about spending, what advice would you give your younger self, like long before Dems?
00:31:39.359 --> 00:31:44.240
Oh, well, you know, this is this is every grown woman to their mother.
00:31:44.319 --> 00:31:47.119
Like my mother was not mean and she was not cheap.
00:31:47.279 --> 00:31:48.559
She was whip smart.
00:31:48.640 --> 00:31:53.440
And I, you know, it was honestly, it's I know it's cliche, it's such a gift.
00:31:53.599 --> 00:31:54.559
It was such a gift.
00:31:54.640 --> 00:31:58.720
I mean, my sister and I can stretch a dollar like no one's business.
00:31:58.880 --> 00:32:04.559
We have one girlfriend who says that we could meddle in dollar stretching, and she says, and I'm not talking silver and bronze.
00:32:04.720 --> 00:32:11.519
I mean, we'd just, but it's because we practiced our our, you know, the whole time from grade eight forward, we practice.
00:32:11.599 --> 00:32:26.480
And so even to this day, I mean, it sometimes it does drive my husband and son crazy because it doesn't bother me at all to go shopping and come home empty-handed, because I know I'm building the list of like features that really mean something to me, you know, the price point that I'm comfortable with.
00:32:26.640 --> 00:32:33.200
And trust me, when when I see the thing that I've been looking for and I know it's going to do what I need to do, I have no problem waving it in.
00:32:33.359 --> 00:32:36.400
But equally, it doesn't bother me at all to come home empty-handed.
00:32:36.559 --> 00:32:38.160
But that's a skill, right?
00:32:38.640 --> 00:32:40.799
And it's developed over time.
00:32:41.519 --> 00:33:00.400
Yeah, I I I love that is to take your time before making a purchase is, you know, one is sometimes that waiting period, you'll find you don't really want it, is, you know, because there's impulse purchase like at the grocery stores, there's things in your uh the checkout counter that, you know, that you may want to buy.
00:33:00.480 --> 00:33:05.519
But you know, oftentimes if you wait an hour, you go, oh, you know, I don't really want that at all.
00:33:05.599 --> 00:33:06.880
Or you wait a day.
00:33:07.039 --> 00:33:13.759
You know, I know that's something my wife does, is she'll put a bunch of things in an online shopping cart and then go back a couple of days later.
00:33:13.920 --> 00:33:16.720
Well, once she's waiting to see if they'll go on sale or get a coupon.
00:33:16.880 --> 00:33:20.640
But right, the other thing is she'll go, Well, do I really want that or not?
00:33:21.119 --> 00:33:22.079
Exactly.
00:33:22.960 --> 00:33:24.799
So it's a that's a great skill.
00:33:24.960 --> 00:33:31.200
So, Karen, to close out, what's your number one tip to change the way we think about money?
00:33:32.480 --> 00:33:33.839
Ask, does it make sense?
00:33:34.000 --> 00:33:35.039
Not can I afford it?
00:33:35.200 --> 00:33:36.720
Start with does it make sense?
00:33:36.880 --> 00:33:41.119
Because if it makes sense, chances are you're gonna find a way to afford it.
00:33:41.279 --> 00:33:56.000
Sometimes it takes a long time to be able to afford what we want, but it's a lot easier to forego other purchases so that you can afford what you want when you when you're very clear on what it is you need to, you know, fill a need.
00:33:57.200 --> 00:33:58.319
Yeah, I love that.
00:33:58.480 --> 00:33:59.200
That's great.
00:33:59.359 --> 00:34:02.960
Is you know, make sure you're asking the right question.
00:34:03.039 --> 00:34:07.119
And in this case, the right question is does it make sense?
00:34:07.440 --> 00:34:09.679
Not the affordability questions.
00:34:09.760 --> 00:34:14.719
And that's a big part of money and life is knowing the right question to ask.
00:34:14.960 --> 00:34:16.559
So that's wonderful advice to push.
00:34:16.800 --> 00:34:25.360
I mean, listen, I don't I don't want to dismiss, you know, some families are living with, you know, real, real, real scarcity.
00:34:25.519 --> 00:34:29.599
And so that question might strike them as a luxury.
00:34:30.000 --> 00:34:32.400
But I think that there are many families.
00:34:32.559 --> 00:34:33.840
There's of course a continuum.
00:34:34.239 --> 00:34:39.599
And if they would start with that question, they they might take some pressure off themselves.
00:34:40.079 --> 00:34:49.920
And and, you know, this is what we are told by parents and educators all the time that this tool really does take pressure off kids and families.
00:34:50.079 --> 00:34:58.480
And that makes us really happy because we're trying to give them a life skill so that they know that financial confidence is within their reach.
00:34:59.119 --> 00:34:59.599
Yeah.
00:34:59.920 --> 00:35:02.800
And for the adults listening out there, this works for you.
00:35:03.039 --> 00:35:09.599
Is Karen and I have talked about this, is you know, the DIMMS calculator is uh, you know, was created for kids.
00:35:09.679 --> 00:35:13.360
But, you know, if we're thinking about going to the ball game, it works the same way.
00:35:13.440 --> 00:35:28.800
As like, for example, I was thinking, you know, Karen, as you were explaining it, is if I go to the Giants game, I have to buy the ticket to the Giants game, I have to buy a ferry ticket, then, you know, we're probably gonna, you know, it's like if you give a mouse a cookie, then I'm probably gonna want something to eat when I get to the game.
00:35:28.960 --> 00:35:32.400
And then, you know, if I take my son, he's probably gonna want a souvenir.
00:35:32.719 --> 00:35:37.920
And so, you know, we end up spending two or three times sometimes the price of the ticket.
00:35:38.159 --> 00:35:44.559
That's a that's a big epiphany for kids, that the total cost of an event, it's not hard for it to be three X the ticket.
00:35:44.719 --> 00:35:45.679
It's really not.
00:35:45.920 --> 00:35:48.800
And that's a that's a mic drop moment for them.
00:35:49.039 --> 00:35:58.159
And the other mic drop moment I should have said, sorry, if I could just go back and add in is the um environmental impact of mindful spending.
00:35:58.320 --> 00:36:06.800
Uh, we we pull all the kids at the beginning of every workshop and we ask them if they've ever received a holiday or a birthday gift that, you know, wasn't quite what they were hoping for.
00:36:06.960 --> 00:36:09.119
So what do you think the answer is, Tony?
00:36:10.000 --> 00:36:11.599
Oh yes.
00:36:11.760 --> 00:36:14.400
Uh sorry, I I didn't get the full question, but I apologize.
00:36:14.880 --> 00:36:19.760
Have you ever received a birthday or a holiday gift that wasn't quite what you were hoping for?
00:36:20.000 --> 00:36:20.639
Oh, yeah.
00:36:20.880 --> 00:36:21.199
Yeah.
00:36:21.440 --> 00:36:28.800
So 93% of kids that we've surveyed over, you know, we're coming up on 11 years now, have answered yes to that question.
00:36:29.119 --> 00:36:48.239
So if you if we just reduce that number by 10%, so we go from 93% of kids just getting one holiday or birthday gift a year that they don't use or appreciate to 83% of kids, it's 56 less NFL football fields covered in garbage.
00:36:48.880 --> 00:36:49.920
We did the math.
00:36:50.079 --> 00:36:51.440
We did the math carefully.
00:36:51.599 --> 00:36:53.599
And that is a mic drop slide for kids.
00:36:53.679 --> 00:36:58.079
And we are often told that around the supper table, that's what they brought home.
00:36:58.239 --> 00:36:59.760
They were like, and would you believe?
00:37:00.000 --> 00:37:05.760
Because, you know, so many of toys and small gadgets, you know, they have an incredibly long half-life.
00:37:06.000 --> 00:37:08.000
And even they have a carbon footprint, right?
00:37:08.079 --> 00:37:12.960
Very simply, we define that as the amount of uh energy required to produce and deliver something.
00:37:13.039 --> 00:37:16.320
And so you're not giving up anything that you actually use and appreciate.
00:37:16.400 --> 00:37:20.239
You're just giving up stuff that you that you didn't use, didn't appreciate.
00:37:20.480 --> 00:37:26.559
But look at you by default, you lowered your carbon footprint and reduced the number of items you put on a landfill in your lifetime.
00:37:26.719 --> 00:37:31.440
And you might say to yourself, oh, it's one t-shirt, it's one set of shoelaces, it's one board game.
00:37:31.599 --> 00:37:35.199
There are 60 million school-aged children in Canada and the US alone.
00:37:35.440 --> 00:37:36.159
It's a lot.
00:37:36.320 --> 00:37:36.960
It adds up.
00:37:37.039 --> 00:37:40.480
And and you know, it's cooperation is humanity's superpower.
00:37:40.559 --> 00:37:43.840
If we all do our part, we can make a difference.
00:37:45.280 --> 00:37:47.920
We all do our part, we can make a difference.
00:37:48.159 --> 00:37:50.960
Um, I think that's a great place to close.
00:37:51.199 --> 00:37:55.519
Um, so Karen, where can people learn more about you and gifting sense?
00:37:55.599 --> 00:37:58.639
And most importantly, check out the Doesn't Make Sense calculator.
00:37:58.960 --> 00:37:59.920
It's very easy.
00:38:00.000 --> 00:38:04.480
It's gifting sense, G-I-F-T-I-N-G, S-E-N-S-E.
00:38:04.719 --> 00:38:08.400
It's a wordplay, so it's brain sense instead of money sense.org.
00:38:08.559 --> 00:38:12.239
And we're truly permissionless, no registration, no login, no paywall.
00:38:12.400 --> 00:38:17.840
So you just type gifting sense into any browser with access to the internet, we'll pop right up.
00:38:18.480 --> 00:38:19.119
Fantastic.
00:38:19.199 --> 00:38:25.760
And for everybody watching and listening, there of course will be links in the show notes so you can check out that the show notes to get those links.
00:38:26.000 --> 00:38:29.599
Aaron, thanks again for coming back on Get Ready Before Life Happens.
00:38:30.000 --> 00:38:31.280
My pleasure, Tony.
00:38:31.760 --> 00:38:36.880
And thank you, everyone, as always, for tuning in to this episode of Get Ready Before Life Happens.
00:38:37.119 --> 00:38:43.199
If this episode helped you change the way you think about spending, please be sure to subscribe and to share it with a friend.
00:38:43.360 --> 00:38:49.280
You can join the Get Ready Movement at Tony Stewart.com to receive my newsletter and some free resources.
00:38:49.440 --> 00:38:55.599
And if you want to support the podcast, you can now do so at buymeacoffee.com slash Tony Stewart.
00:38:55.760 --> 00:39:00.239
Because when life happens, the way you think about money matters.
00:00:04.719 --> 00:00:10.640
Get ready before life happens, the podcast helping you navigate life's blood.
00:00:17.359 --> 00:00:21.519
What if every purchase came with one simple question?
00:00:21.920 --> 00:00:23.440
Does it make sense?
00:00:23.679 --> 00:00:25.920
Welcome to Get Ready Before Life Happens.
00:00:26.000 --> 00:00:29.440
I'm pleased to be joined today by my friend Karen Holland.
00:00:29.760 --> 00:00:32.320
Aaron, welcome back to Get Ready Before Life Happens.
00:00:32.640 --> 00:00:33.600
Oh, thank you, Tony.
00:00:33.679 --> 00:00:34.960
I'm so happy to be here.
00:00:35.679 --> 00:00:46.159
Yeah, I'm glad to have you on as you've developed a really cool resource called the Does It Make Sense Calculator, which I mean, you know, you and I have talked about it.
00:00:46.240 --> 00:00:47.119
I'm a huge fan of.
00:00:47.200 --> 00:00:56.000
And I hope after listening to this episode, everybody out there is going to, you know, check it out and hopefully it can make a difference for them, like I think it will.
00:00:56.240 --> 00:00:58.240
So, Karen, tell us a little bit about yourself.
00:00:58.399 --> 00:01:06.560
What is your origin story and how did it lead you to focusing on helping young people to think before they buy?
00:01:07.599 --> 00:01:11.359
Well, it was super organic, not on purpose.
00:01:11.599 --> 00:01:13.920
Um, I'm one of three girls.
00:01:14.079 --> 00:01:19.200
Our mother was a kindergarten teacher, uh, whip smart kindergarten teacher.
00:01:19.519 --> 00:01:27.439
And before the summer before eighth grade, she had us make a list of everything we would need for back to school.
00:01:27.680 --> 00:01:29.680
And we were like, oh, this is amazing.
00:01:29.840 --> 00:01:33.280
So we thought we made this like super comprehensive list.
00:01:33.359 --> 00:01:38.959
You know, we really went to town and um and we had to give a number for everything on the list.
00:01:39.040 --> 00:01:46.480
And then uh my mom tallied it up, divided it by the 10 months of the school year, and she gave us a check.
00:01:46.879 --> 00:01:52.400
Kids, that's a piece of paper you take to the bank that lets you get a certain amount of money out.
00:01:52.560 --> 00:01:56.879
She gave us a check for the first day of every month, and we had to buy everything.
00:01:56.959 --> 00:01:59.599
So she was giving us the purchasing power.
00:01:59.920 --> 00:02:03.840
And when it first started, I remember that September, like yesterday.
00:02:04.000 --> 00:02:10.479
I mean, I I've said this to other people before, but I mean, and I have a twin sister, Kathy, and I were so we were like, why are we even going to school?
00:02:10.639 --> 00:02:11.360
We're loaded.
00:02:11.439 --> 00:02:12.560
It was$79.
00:02:13.039 --> 00:02:17.120
We got$78, which you know, you think like that was a lot of money.
00:02:17.199 --> 00:02:18.319
I'm old.
00:02:18.800 --> 00:02:23.520
Of course, my mother was so smart, she knew that list was not comprehensive.
00:02:23.680 --> 00:02:25.439
It did not cover everything.
00:02:25.759 --> 00:02:26.800
And guess what?
00:02:26.960 --> 00:02:36.240
We got really good at quick making trade-offs because you knew that if you bought one thing, you know, you were trading future purchasing power.
00:02:36.400 --> 00:02:39.120
So, fast forward, I have my own family.
00:02:39.280 --> 00:02:43.039
I spent 12 years on the sidelines of baseball and hockey games.
00:02:43.280 --> 00:02:47.280
You're going to all these tournaments, you know, you're spending every weekend with the same family.
00:02:47.439 --> 00:02:59.120
We parent in tribes, and it's becoming obvious that um other families don't have this same sort of simple structure in place for spending, which is asking, you know, does this make sense?
00:02:59.439 --> 00:03:02.000
Is this something that I'll still want next week?
00:03:02.240 --> 00:03:06.159
Um, am I confusing short-term excitement with lasting value?
00:03:06.319 --> 00:03:10.000
Do I understand the full cost, not just the price tag?
00:03:10.240 --> 00:03:12.800
Um, and you know, certainly relevant for today's kids.
00:03:12.879 --> 00:03:13.680
It was less so then.
00:03:13.759 --> 00:03:15.280
My son's a man now.
00:03:15.520 --> 00:03:18.800
Um, have I really thought this through or am I just clicking by?
00:03:19.680 --> 00:03:25.599
So uh, you know, I just started asking my friends' kids these questions.
00:03:25.759 --> 00:03:29.919
And by the time Matt went off to school, people were saying, go talk to Karen.
00:03:30.560 --> 00:03:34.960
And then I I wireframed the site because I just saw how helpful it was.
00:03:35.039 --> 00:03:39.520
There's a there's a very, he's sort of an iconic um financial reporter.
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Robin's spoken about him before, uh, Rob Kerrick.
00:03:42.479 --> 00:03:43.919
And he said, What are you really doing, Karen?
00:03:44.080 --> 00:03:44.479
What are you doing?
00:03:44.639 --> 00:03:46.879
And I said, I'm I'm just slowing them down.
00:03:47.199 --> 00:03:48.319
Just slowing them down.
00:03:48.560 --> 00:03:52.240
Because when we take a beat, we make better choices.
00:03:52.479 --> 00:04:01.280
And the problem, Tony, is that today's environment has been engineered to remove all the helpful pauses that you and I grew up with.
00:04:03.120 --> 00:04:03.439
Yeah.
00:04:03.840 --> 00:04:06.400
And you and I have had that conversation before.
00:04:06.479 --> 00:04:07.680
It's about the friction.
00:04:07.840 --> 00:04:15.360
So, you know, that's the friction of when we were young is, you know, if you wanted something, you had to get money out of the bank.
00:04:15.520 --> 00:04:20.240
The bank, you know, was you know, was wasn't open every day, all day.
00:04:20.480 --> 00:04:24.720
And then you had to go somehow get yourself to whatever store it was.
00:04:24.800 --> 00:04:36.879
I'm thinking records or comic books in my case, and then the store had to be open, and then you had to have enough cash to buy it, then it took some work to make a purchase.
00:04:37.040 --> 00:04:42.240
And now it's like Amazon's got the buy it now button, and then you have it an hour later.
00:04:42.560 --> 00:04:45.920
And the and the thing is, friction is not all bad.
00:04:46.079 --> 00:04:47.120
It creates resilience.
00:04:47.199 --> 00:04:53.920
Like, think about how we engage with friction purposefully to be fit because we know that's going to make us stronger.
00:04:54.240 --> 00:04:58.560
So why are why are we removing it and all of these other facets of life?
00:04:58.639 --> 00:05:01.120
And I I just I'm not sure.
00:05:01.360 --> 00:05:18.160
I think for you know, parents who who it's we've got very few parents today who didn't grow up with any friction, but their children are digital payment system natives, and it is so frictionless.
00:05:18.399 --> 00:05:27.120
And I think that, you know, it's it's very hard for us to understand how powerful, you know, algorithmic persuasion is.
00:05:27.199 --> 00:05:33.439
It's embedded in every platform that teenagers, young people, not to mention ourselves, I mean, we use we use these things every day, right?
00:05:33.519 --> 00:05:35.839
And these are not benign neutral tools.
00:05:35.920 --> 00:05:46.800
And so the young person who is arriving in this environment without a practiced habit of reflection, it's actually much harder for them to be thoughtful about how they spend.
00:05:46.959 --> 00:05:47.600
It really is.
00:05:47.759 --> 00:05:49.199
It's not their fault.
00:05:49.920 --> 00:05:50.319
Yeah.
00:05:50.800 --> 00:06:04.720
And we've I've gone through that with my son, is you know, because it, you know, and and I try to tell him is look, this stuff is designed to get you to buy, and they have these limited drops and you know, all of these other things.
00:06:04.800 --> 00:06:08.800
And it's just it's just constantly at them.
00:06:09.040 --> 00:06:12.000
And it's like you said, it's so easy to do.
00:06:12.160 --> 00:06:20.319
So, like, you know, what tips do you have for parents who are going, my gosh, how do I even begin to give my kid a sense of friction?
00:06:20.720 --> 00:06:21.279
It's interesting.
00:06:21.439 --> 00:06:29.360
Just last week, a parent made a comment to me, and I was like, I've I've heard it before, but they just said it really succinctly.
00:06:29.519 --> 00:06:42.480
And it's basically that the doesn't make sense score calculator is asking questions that they have asked, but you don't get to'd or you don't, as a child, you don't give attitude to the doesn't make sense score calculator.
00:06:42.560 --> 00:06:45.759
You just answer the questions because you know there's method to the madness, right?
00:06:45.839 --> 00:06:56.079
You want to get to the score, you want to produce that charitable summary, you want to sit down and have a conversation with your parents about possibly moving this purchase from wish list to reality.
00:06:56.399 --> 00:07:06.800
And um, and the and the phrase I thought it was hilarious was ophthalmalic calisthenics, that you know, the DIM score calculator doesn't get any eye rolls, no ophthalmalocalisthenics from the kids.
00:07:07.120 --> 00:07:14.000
Um it really is as simple as slowing down, or I, you know, we use a lot of driving metaphors.
00:07:14.160 --> 00:07:19.680
I mean, I I think that what we're missing in society at large is spending ed, right?
00:07:19.759 --> 00:07:20.800
We have driver's ed.
00:07:20.959 --> 00:07:24.319
We don't just hand teenagers car keys and hope for the best.
00:07:24.639 --> 00:07:30.720
We give them structured practice in lower stake settings before the consequences can get serious.
00:07:30.959 --> 00:07:33.040
Why not do the same with money?
00:07:33.199 --> 00:07:38.079
And similar to driver's ed, spending ed is not the final destination.
00:07:38.160 --> 00:07:44.399
It's the trip preparation that helps the future unfold the way we want it to, right?
00:07:44.560 --> 00:07:53.680
I mean, I think one of the reasons that um we've been so successful in partnering with other organizations is they know that we're not doing anything duplicative.
00:07:53.759 --> 00:08:10.000
We're not competing with what they're doing, we're helping their work land more powerfully because we're giving kids this lived experience of getting and using financial information to help them make decisions that they're happier with, not just in the short term, but in the long term.
00:08:10.160 --> 00:08:17.920
And they, you know, it doesn't take very much distance to be able to take a backward glance and go, wow, I really I spared myself, my family.
00:08:18.079 --> 00:08:19.040
That was great.
00:08:19.199 --> 00:08:22.160
And then of course, success is tasty.
00:08:22.319 --> 00:08:29.920
So once you discover that you can get and use financial information quite easily to help you make good decisions, well, why would you ever stop?
00:08:31.680 --> 00:08:34.240
Yeah, no, that that's so good.
00:08:34.399 --> 00:08:46.720
And you know, what you said is, you know, thinking helps you make decisions to happier with in the long term, is because you know, I I'm sure everybody out there has had that feeling where you've bought something, you go, what was I thinking?
00:08:47.200 --> 00:08:48.799
Literally, why did I buy that?
00:08:49.519 --> 00:08:59.440
Yeah, you know, but it it it's when that rushing in, and it is hard to take a beat, but when you do take a beat, you can oftentimes pull yourself back.
00:08:59.519 --> 00:09:19.919
And it's something that I've talked about on some of my podcasts with people when we're talking about scams and frauds, that that is one good one thing that fraudsters try to get you to do is to make that decision right now under pressure, which is kind of how a lot of these things are presented to our kids, is like, you got to make this decision now.
00:09:20.000 --> 00:09:20.720
You can't wait.
00:09:20.879 --> 00:09:22.399
I mean, that's that's a huge red flag.
00:09:22.559 --> 00:09:24.240
I know we've had this conversation before.
00:09:24.559 --> 00:09:27.440
Pressure is a huge red flag, right?
00:09:27.600 --> 00:09:31.600
I mean, anybody who's putting pressure on you does not have your best interest at heart.
00:09:31.840 --> 00:09:35.279
They should want you to feel like super comfortable.
00:09:35.600 --> 00:09:46.480
I mean, uh, one of the things, and and uh Rob again really liked this phrasing is I like to tell kids and families and school administrators, we are not in the feel bad about spending business.
00:09:46.559 --> 00:09:48.559
We're in the think more about spending business.
00:09:48.799 --> 00:09:52.559
And one uh question we ask in workshops is what's a purchase?
00:09:52.639 --> 00:09:54.080
So I'll ask this to you, Tony.
00:09:54.240 --> 00:09:58.879
What's something that you bought that you're like, hot damn, that is the best money I ever spent.
00:09:58.960 --> 00:10:00.559
I use that thing all the time.
00:10:00.799 --> 00:10:04.720
It's been so helpful, it's lasted forever, you know, it worn like a bullet.
00:10:04.879 --> 00:10:08.639
Like, what's some purchase that you just it was great money spent?
00:10:10.159 --> 00:10:19.679
Oh boy, thinking off hand is you know, I'd say one of my cars, but the reason is that my car is over 15 years old.
00:10:20.000 --> 00:10:28.399
So I got the maximum value from it instead of buying a new car every two to three years.
00:10:28.639 --> 00:10:31.919
Is that's that's a great budget helper for anybody.
00:10:32.240 --> 00:10:41.679
Well, so that feeling, that feeling of knowing that you spent money well and it was and it's really been a great purchase, that's the feeling I want kids to have for most purchases.
00:10:41.840 --> 00:10:43.919
It's not possible to have them for all purchases.
00:10:44.080 --> 00:10:53.600
And of course, we learn from missteps, but I want you to, I want you to have that confidence and that excitement and that deep satisfaction for most of your purchases.
00:10:53.840 --> 00:10:58.879
And what's so powerful about that is that it preserves future purchasing power.
00:10:59.039 --> 00:11:11.919
Because when you only buy things that you'll actually use and appreciate, that you take care of, almost by default, you create future purchasing power because you stop buying things that are underappreciated, underutilized.
00:11:12.639 --> 00:11:14.240
Yeah, I I love that, Karen.
00:11:14.879 --> 00:11:24.480
You know, that that when you are buying things, it is you don't have a feeling because you know, when you're just buying sort of random things and not thinking about it, is you don't have any satisfaction.
00:11:24.559 --> 00:11:34.240
And you end up not using a lot of the stuff that you buy, uh, which is the other thing is, you know, it's a very short-term, I guess, what is it, adrenaline?
00:11:34.320 --> 00:11:35.279
Would it be adrenaline?
00:11:35.600 --> 00:11:36.159
Dopamine.
00:11:36.320 --> 00:11:37.200
I think they dopamine.
00:11:37.360 --> 00:11:49.679
That's they say, well, I will tell you, I mean, we we underscore most kids expect with, oh, they're coming to a thinking before buying workshop or a mindful spending workshop, they're like, oh, you know, do I really want to learn how to um save money?
00:11:49.840 --> 00:11:52.159
Maybe it's not doesn't strike them as so interesting.
00:11:52.320 --> 00:11:56.480
I mean, one common piece of feedback we get is, oh, that was so much better than I thought it was gonna be.
00:11:56.559 --> 00:11:59.440
And I'm like, great, I'm so glad.
00:11:59.919 --> 00:12:03.840
Um it's not about deprivation, right?
00:12:04.000 --> 00:12:09.919
I mean, when you when you here's let me put it to you another way.
00:12:10.240 --> 00:12:13.519
I think the question we should be starting with is does it make sense?
00:12:13.679 --> 00:12:15.039
Not can I afford it?
00:12:15.360 --> 00:12:20.399
Because if something makes sense in your life, you're gonna figure out a way to make to be able to afford it, right?
00:12:20.559 --> 00:12:30.399
Because you're like, this is gonna reduce my commute, make my day-to-day better, you know, let me have hot lunches, let me feel good when I'm running, whatever it is.
00:12:30.480 --> 00:12:39.440
So if a purchase really fits your life well, if you're really gonna use and appreciate it, then then you're going to figure out a way to be able to afford it.
00:12:39.679 --> 00:12:44.559
So does that make sense when I say I almost think like the the first question should be does it make sense?
00:12:44.720 --> 00:12:46.000
Does it fit your life?
00:12:46.159 --> 00:12:56.879
And then, and if it really does, and maybe it takes months, sometimes years to afford it, but it's also it's so much easier to give up other purchases when you know, like there's your North Star, right?
00:12:56.960 --> 00:12:57.919
This is the thing I want.
00:12:58.080 --> 00:13:01.600
So, for example, many kids this year are Jonesing for World Cup tickets.
00:13:01.759 --> 00:13:05.120
First time the World Cup's gonna be in Canada, Mexico, and the US.
00:13:05.360 --> 00:13:07.039
And so it was very easy.
00:13:07.200 --> 00:13:11.600
We had this little um visual goal tracker, the worth the weight goal tracker.
00:13:11.679 --> 00:13:12.720
They put it on the fridge.
00:13:12.879 --> 00:13:20.639
And so, you know, you're eating your cereal in the morning before you go to school and you see that goal tracker, and maybe a friend says, Oh, let's go get a slice or a latte.
00:13:20.799 --> 00:13:32.960
Well, you can go and be social, but you might say to yourself, Well, I'm not gonna spend$10 on snack food after school because I know I'm only$10 away from those tickets or the jersey or the jacket you want, whatever it is.
00:13:33.279 --> 00:13:37.600
So spending with a plan, you know, it's right on our homepage, is fun and worth it.
00:13:37.679 --> 00:13:39.200
And I know some people are like, right.
00:13:39.279 --> 00:13:40.799
And I'm like, it totally is.
00:13:40.960 --> 00:13:47.519
It totally is fun and worth it because you actually get the thing that you know you will use and appreciate.
00:13:47.600 --> 00:13:50.960
And it is deeply satisfying to be able to do that.
00:13:51.120 --> 00:13:53.200
And and what are we really doing?
00:13:53.440 --> 00:13:55.600
We're showing kids that they have agency.
00:13:55.759 --> 00:13:57.679
That's what this is all about, right?
00:13:59.039 --> 00:14:00.639
Well, I think all of us have agency.
00:14:00.720 --> 00:14:09.360
And actually, I'm thinking about does it make sense in the, you know, in respect to my calendar, is you know, time is one of our most valuable assets.
00:14:09.679 --> 00:14:16.399
And we're often very free with our calendars, but that spends our time.
00:14:17.039 --> 00:14:26.720
Um, you know, I don't know how some people do it where they have their, you know, their calendarly, and it's like they're they have slots open from eight to five every day of the week.
00:14:26.879 --> 00:14:29.120
And I'm like, holy cow.
00:14:29.440 --> 00:14:31.360
Oh no, actually, that's not me.
00:14:31.440 --> 00:14:35.039
Actually, sometimes people are like, there isn't there's nothing for like six weeks.
00:14:35.120 --> 00:14:40.159
And I'm like, well, you know, I'm in schools or I'm I'm doing whatever.
00:14:40.240 --> 00:14:47.360
And actually, I know one gentleman in the UK, he specifically slots out like a chunk every day for deep thinking.
00:14:47.600 --> 00:14:48.639
So I agree with you.
00:14:48.799 --> 00:14:53.279
That's that's one of the ways you should think about does it make sense for sure.
00:14:53.440 --> 00:14:53.679
Yeah.
00:14:54.159 --> 00:14:54.879
Yeah, I love it.
00:14:54.960 --> 00:15:00.879
I I know it's not the intent, but but when you say does it make sense and can it be applied everywhere?
00:15:01.039 --> 00:15:04.240
I I am wholeheartedly on board with that.
00:15:04.639 --> 00:15:10.000
So, Karen, you know, one of the things you know that we talk about is pausing before making a decision.
00:15:10.240 --> 00:15:18.480
So, why is that pause so important before making a financial decision or just any decision at all?
00:15:20.000 --> 00:15:26.799
Because prices, the sticker prices of things, just never reveal the full cost.
00:15:26.879 --> 00:15:28.639
And it doesn't take a lot of time.
00:15:28.799 --> 00:15:32.879
I mean, the doesn't make sense score calculator is quick, but not arbitrary.
00:15:33.039 --> 00:15:37.840
So it doesn't take a lot of time to reveal, you know, I put them into two categories.
00:15:37.919 --> 00:15:39.919
You have ancillary costs and phantom costs.
00:15:40.000 --> 00:15:44.480
So ancillary costs are the things that it doesn't take too much time to realize.
00:15:44.639 --> 00:15:48.240
For example, you're going to a concert, either you've got to take the subway there or pay for parking.
00:15:48.320 --> 00:15:50.320
So that's an example of an ancillary cost.
00:15:50.480 --> 00:16:02.240
But a phantom cost might be, you know, you buy a rainbow loom and you're not really thinking about the fact that once you go through the initial package of elastics, you need more elastics to be able to keep looming.
00:16:02.559 --> 00:16:11.519
So when you pause and answer the questions, and you know, Tony, there's you know, no liver transplants, it's not multivariable calculus.
00:16:11.600 --> 00:16:13.440
These are very straightforward questions.
00:16:13.600 --> 00:16:15.600
You know, how often are you going to use it?
00:16:15.840 --> 00:16:19.759
Can a sibling, a younger sibling or a cousin use it when you're done with it?
00:16:19.919 --> 00:16:23.519
Um, if you're buying, you know, sports equipment to try out for a team.
00:16:23.679 --> 00:16:28.799
Sometimes coaches know where you can borrow the equipment before you know you make that big commitment.
00:16:28.960 --> 00:16:32.799
So it really, it's it's like two to five minutes.
00:16:33.039 --> 00:16:42.080
Just answer these questions, but it helps you understand the full on-time delivered cost of what it is you're buying.
00:16:42.159 --> 00:16:45.440
And that is a very different number than the price tag.
00:16:46.159 --> 00:16:52.080
And I mean, things like buy in, buy now, pay later, which I know you and I'm not, we're not fans.
00:16:52.240 --> 00:17:01.679
Um, you know, that that cuts the cost in four, which, you know, totally, and there's four reasons that we experience buyer's remorse.
00:17:01.840 --> 00:17:11.200
We overestimate use, we underestimate cost, we mistake short-term excitement for lasting value, and uh, you know, we just act too quickly.
00:17:11.519 --> 00:17:15.920
So buy now, pay later exacerbates all three of those.
00:17:16.079 --> 00:17:21.119
The only one it doesn't exacerbate is underestimating um overestimating use, sorry.
00:17:21.279 --> 00:17:25.119
But you underestimate cost, it accelerates your decision, right?
00:17:25.200 --> 00:17:30.160
It lets you mistake short-term excitement for lasting value and it totally reduces friction.
00:17:30.400 --> 00:17:33.279
So it's just pausing is it's like a superpower.
00:17:33.440 --> 00:17:34.400
I mean, it's free.
00:17:34.559 --> 00:17:36.319
Anybody can take a beat.
00:17:36.640 --> 00:17:38.480
And I almost can't think.
00:17:38.559 --> 00:17:41.440
I mean, I guess if a train's rolling down the track, don't pause.
00:17:41.519 --> 00:17:42.960
Just go on instinct.
00:17:43.119 --> 00:17:47.039
But when you're shopping and you're buying something, take a minute.
00:17:47.200 --> 00:17:48.319
Just give yourself a minute.
00:17:48.400 --> 00:17:51.039
It is, you know, there's a reason we're called gifting sense.
00:17:51.119 --> 00:17:52.160
It is a gift.
00:17:52.319 --> 00:17:53.039
It is a gift.
00:17:53.200 --> 00:17:59.440
Developing this habit of pausing, gathering information, and reflecting before you spend your money or anybody else's.
00:17:59.519 --> 00:18:02.319
Because if you're asking for a birthday or a holiday gift, that's what you're doing.
00:18:02.400 --> 00:18:04.400
You're asked somebody to spend money.
00:18:04.720 --> 00:18:07.920
Just take a beat and you won't be disappointed.
00:18:08.079 --> 00:18:13.759
The people who care about you won't waste time and money running around buying things that you don't want, anyways, won't use and appreciate.
00:18:13.839 --> 00:18:18.400
And then, I mean, we could talk for an hour about the environmental consequences.
00:18:19.759 --> 00:18:20.000
Yeah.
00:18:20.640 --> 00:18:25.200
So, so Karen, take us through, you know, a full calculation.
00:18:25.359 --> 00:18:29.279
Maybe let's talk about going to a concert.
00:18:29.440 --> 00:18:37.839
You know, talk talk us through, you know, the process that somebody would go through with the DEMS calculator and thinking about going to a concert.
00:18:38.559 --> 00:18:44.480
Um, okay, so I first want to say that when we talk about a process, I mean, let's be clear on screen.
00:18:44.640 --> 00:18:47.599
I mean, the very first time you go through it, maybe it's five minutes.
00:18:47.680 --> 00:18:49.920
And then every time after that, it's like two to three.
00:18:50.079 --> 00:18:51.599
So we'll call it a process.
00:18:51.759 --> 00:18:54.400
And it it is quick, but it is not arbitrary.
00:18:54.559 --> 00:18:57.759
So it's really split into, I would say, three parts.
00:18:57.839 --> 00:18:59.599
So the first part is just the numbers.
00:18:59.680 --> 00:19:04.240
So like the actual price, if it's relevant, sales tax, shipping.
00:19:04.319 --> 00:19:05.599
So you wanted a concert.
00:19:05.680 --> 00:19:10.640
So you need the ticket price, which often includes um all of these fees, right?
00:19:10.799 --> 00:19:11.839
Venue fees.
00:19:12.000 --> 00:19:15.839
And then you move to, okay, well, how much does safe transportation cost?
00:19:16.160 --> 00:19:19.440
You're gonna want something to eat and drink, right?
00:19:19.519 --> 00:19:24.400
And very few venues allow outside uh food and drink in the venue.
00:19:24.559 --> 00:19:28.799
Actually, that was one interesting thing we discovered when we launched in the United Kingdom.
00:19:28.960 --> 00:19:34.960
They do allow you to bring brown bag lunches, which for families would be fantastic, but that's not the case in North America.
00:19:35.279 --> 00:19:38.720
Often, if it's your first time, your seminal concert, right?
00:19:38.880 --> 00:19:41.039
You want um a souvenir.
00:19:41.200 --> 00:19:43.200
So, okay, what is that gonna cost?
00:19:43.519 --> 00:19:50.079
And then, you know, what if what if something happens and all of a sudden you can't take uh the subway home, you have to take an Uber?
00:19:50.160 --> 00:19:52.079
You know, you just have to plan for all of these things.
00:19:52.160 --> 00:19:55.359
So the first part is just understanding the numbers.
00:19:55.599 --> 00:20:00.319
And uh then the second part is thinking more deeply about how this purchase fits into your life.
00:20:00.400 --> 00:20:04.480
So the number one question is do you know when and where this event takes place?
00:20:04.640 --> 00:20:06.079
And kids are like, well, why do we have to know that?
00:20:06.160 --> 00:20:13.279
And I'm like, well, first of all, everything depends on the date, like the cost of transportation, when the concert is, are you gonna have to miss school?
00:20:13.519 --> 00:20:20.000
Missing school isn't necessarily a deal breaker as long as you have a plan in place to make up for the missed work.
00:20:20.160 --> 00:20:22.640
But again, that's information that your parents need.
00:20:22.720 --> 00:20:25.039
Like our whole life is making the case, right?
00:20:25.119 --> 00:20:32.480
You have to make make the case to your employer, uh, make the case to your spouse when you're trying to decide if you should purchase something.
00:20:32.640 --> 00:20:36.960
So it's it's really exercising that make your case muscle.
00:20:37.200 --> 00:20:42.160
And of course, the exciting thing is when kids go through and answer those questions, they stop themselves.
00:20:42.240 --> 00:20:44.319
They're like, oh, well, wait a minute.
00:20:44.640 --> 00:20:49.759
This is, you know, for example, Super Bowl tickets, this is much more money than I appreciated it was.
00:20:49.920 --> 00:20:53.599
So I want to recalibrate and and maybe think about doing something else.
00:20:53.759 --> 00:20:55.119
So the first part is math.
00:20:55.279 --> 00:21:00.880
The second part is thinking about, you know, how hard is it to execute, like how hard is it to get there?
00:21:01.119 --> 00:21:09.599
Uh, one question that's in every does it make sense score calculation is does this purchase tell the rest of the world what you want them to know about you?
00:21:09.759 --> 00:21:12.799
Which is our euphemism for is it values aligned?
00:21:12.880 --> 00:21:19.599
And we define values for kids as the ideas and beliefs that your family uh upholds.
00:21:20.319 --> 00:21:24.400
So that can that can be where people stop themselves, right?
00:21:24.480 --> 00:21:26.720
And we use funny examples in workshops.
00:21:26.799 --> 00:21:31.200
Like I always so Tony, what's an what's a vegetable you don't enjoy eating?
00:21:32.559 --> 00:21:33.519
Uh tomatoes.
00:21:33.680 --> 00:21:35.119
Well, actually, tomatoes is a fruit.
00:21:35.920 --> 00:21:36.160
Okay.
00:21:36.559 --> 00:21:37.599
We'll just go with tomatoes.
00:21:37.839 --> 00:21:38.960
Okay, we'll go with tomatoes.
00:21:39.039 --> 00:21:40.160
So good news, Tony.
00:21:40.319 --> 00:21:42.960
Next weekend there's a tomato festival two minutes from your house.
00:21:43.119 --> 00:21:43.839
Are you going?
00:21:44.559 --> 00:21:45.440
Nope.
00:21:46.079 --> 00:21:50.240
Okay, well, what if all your friends were gonna be there?
00:21:50.960 --> 00:21:53.039
It's a tomato festival, no chance.
00:21:53.359 --> 00:21:55.759
Okay, well, you can even think about it.
00:21:56.000 --> 00:21:59.519
Right, you have a sense of self, but sometimes kids will be like, well, I'm gonna go.
00:22:00.079 --> 00:22:02.319
I'm just not going to eat tomatoes because they're not my jam.
00:22:02.480 --> 00:22:11.279
But here's the problem: then a week after you went to the tomato festival, you're going to a friend's house for dinner, they're planning the menu, and the older brother is like, I saw Tony at the tomato festival.
00:22:11.359 --> 00:22:15.839
So let's have cumulative tomato soup, toasted tomato sandwiches, whatever it is, right?
00:22:16.000 --> 00:22:19.440
So the you know, social media is an issue for lots of reasons.
00:22:19.599 --> 00:22:25.039
But one of them is when we buy something or go somewhere, it's it's not private.
00:22:25.599 --> 00:22:28.640
So it's it's telling the rest of the world something about you.
00:22:28.799 --> 00:22:30.799
So, you know, we try to make it funny.
00:22:30.960 --> 00:22:34.960
A closer real word example would be um downloading music.
00:22:35.039 --> 00:22:37.119
You just like the way it sounds, the rhythm and the beat.
00:22:37.200 --> 00:22:49.279
You're not paying any attention to the lyrics, which could really contain words that hurt somebody else's feelings, or you know, you put a sticker on a long board or a binder, you like the color, the shape, maybe it has a symbol who hurts somebody's feelings.
00:22:49.440 --> 00:22:53.759
So we're like, it's the actually the last question in every does it make sense score calculation.
00:22:53.839 --> 00:22:59.039
And we're like, is this purchase, is this event telling the rest of the world what you want?
00:22:59.279 --> 00:23:03.599
So then you answer the questions, we distill those answers into a score out of 10.
00:23:04.319 --> 00:23:24.079
If you can generate a doesn't make sense score of eight or greater, that means you probably have enough information to proceed and have a conversation with your parents or caregivers about moving this possibly purchase from wish list to reality, and you can generate a shareable summary of all that math and thinking, and that's called the DIM score report.
00:23:24.160 --> 00:23:26.480
So those are the three sections.
00:23:26.640 --> 00:23:27.839
Does that answer your question?
00:23:28.000 --> 00:23:37.759
And you know, I I took five minutes to describe it, but I think it really happens very quickly once a young person is used to the platform.
00:23:38.400 --> 00:23:41.599
Yeah, and and you know, I think that's a beautiful description.
00:23:41.759 --> 00:23:43.039
I appreciate you sharing it.
00:23:43.200 --> 00:23:45.039
And I think it's something that we can apply.
00:23:45.200 --> 00:23:47.039
You and I have talked about this to so many things.
00:23:47.200 --> 00:24:01.839
Adults can apply this, is you know, when somebody's talking about buying a new car, I go, well, think about, you know, you have the registration, you have the insurance, which is going to be higher on a new car, you have all these other things that go with it.
00:24:02.000 --> 00:24:05.680
You want to try to avoid the warranty that they sell you at the dealership.
00:24:05.920 --> 00:24:07.599
So I I mean, I don't know if you know.
00:24:07.680 --> 00:24:10.079
We actually we just released a first car.
00:24:10.240 --> 00:24:11.440
Does it make sense for a country?
00:24:11.839 --> 00:24:12.160
That's right.
00:24:12.240 --> 00:24:12.559
I forgot.
00:24:12.799 --> 00:24:18.319
And and it was actually, I mean, it's the that's the most consequential choice that we've helped young people with.
00:24:18.400 --> 00:24:20.000
Before that, it was pets.
00:24:20.319 --> 00:24:23.440
Um it's it's been on fire.
00:24:23.599 --> 00:24:31.119
It's and actually it's so interesting because some somebody wrote to us and said, Oh, this speaks of privilege, a car for a teenager.
00:24:31.359 --> 00:24:40.880
But, you know, in a lot of, you know, rural communities where there's no public transportation, kids are thinking about a car from a very early age on.
00:24:40.960 --> 00:24:42.960
And I mean, we're not talking about a brand new car.
00:24:43.039 --> 00:24:47.920
They're almost always, you know, not just a first second hand down, they're a second, second hand down.
00:24:48.079 --> 00:24:54.640
Uh, but we need these kids to understand, even if you get a fantastic deal on a first car, you're exactly right.
00:24:54.799 --> 00:24:57.440
All of those things, insurance, of course, is a huge cost.
00:24:57.920 --> 00:24:58.880
Maintenance, right?
00:24:59.039 --> 00:25:01.279
Repairs never happen when it's convenient.
00:25:01.359 --> 00:25:02.960
It's always when it's not convenient.
00:25:03.200 --> 00:25:05.680
Gas, that's a topical number, right?
00:25:05.839 --> 00:25:07.440
How much is gas gonna cost?
00:25:07.839 --> 00:25:08.319
Right.
00:25:08.640 --> 00:25:13.440
So it just lays bare all the components of a purchase.
00:25:13.519 --> 00:25:17.119
And here's the exciting thing kids are like everybody else.
00:25:17.200 --> 00:25:22.160
When they see those numbers, they automatically know what does or does not make sense for them and their family.
00:25:22.319 --> 00:25:24.960
Sometimes school administrators are a little reticent.
00:25:25.039 --> 00:25:27.039
They're like, we don't want to put any pressure on our parents.
00:25:27.200 --> 00:25:29.440
And I'm like, you know, I've been doing this a long time.
00:25:29.519 --> 00:25:34.960
I don't know everything, but trust me, kids are so aware of their family situation, they stop themselves.
00:25:35.119 --> 00:25:49.519
In fact, I was in southern San Diego last week at a school, and the school superintendent who brought us into um her middle school, one of her middle schools, was sharing after the fact that she was working with a student who wanted a cat.
00:25:50.160 --> 00:25:55.359
And so they got to the food question, and Liz said, Well, I just bought cat food for my cat.
00:25:55.440 --> 00:25:57.519
It was$40 if for one month.
00:25:57.599 --> 00:25:59.759
So you need to go 12 times$40.
00:26:00.079 --> 00:26:02.240
And like the student stopped right there.
00:26:02.319 --> 00:26:05.519
She's like,$480 just to feed the cat?
00:26:05.759 --> 00:26:06.720
Liz was like, Yeah.
00:26:06.960 --> 00:26:09.839
She's like, Oh, okay, time out, right?
00:26:10.160 --> 00:26:12.799
So it's a it's such a worthwhile process.
00:26:12.880 --> 00:26:16.960
I mean, parents report getting fewer, better quality requests to spend.
00:26:17.200 --> 00:26:20.799
You know, kids feel like they're part of the conversation.
00:26:20.960 --> 00:26:22.319
They have agency, right?
00:26:22.400 --> 00:26:30.720
They're they're discovering, like, the reason it improves family harmony is because it gets all family members singing from the same song sheet.
00:26:30.799 --> 00:26:32.960
All of a sudden, the kids understand what the big deal is.
00:26:33.039 --> 00:26:37.680
I always say most family discord about spending is sort of answering the question: what's the big deal?
00:26:37.759 --> 00:26:38.319
What's the big deal?
00:26:38.400 --> 00:26:39.279
I just want to go to the movies.
00:26:39.359 --> 00:26:41.839
Well, the big deal isn't the$8 movie ticket.
00:26:42.079 --> 00:26:46.799
It's the fact that you need$16 for popcorn and soda and you've got to get there and back safely.
00:26:46.960 --> 00:26:50.880
You know, it's all of these other things that aren't obvious at first pass.
00:26:51.119 --> 00:27:00.799
So slowing down, pausing, using the doesn't make sense score calculator just helps you be aware of all components of a purchase.
00:27:01.039 --> 00:27:05.279
And I promise you, when kids are aware, they make great decisions.
00:27:06.079 --> 00:27:07.599
Yeah, and so do adults.
00:27:07.839 --> 00:27:14.160
And um, for everybody watching and listening, is uh Karen's organization, gifting sense is a nonprofit.
00:27:14.240 --> 00:27:16.400
So the calculator is free to use.
00:27:16.559 --> 00:27:22.559
So um, and there'll be links to it in the show notes so you can go check out the DEMS calculator for yourself.
00:27:22.720 --> 00:27:32.640
So before we start to wrap up, Karen, is what do you find tends to surprise students and or their families the most when they work through the DEMS calculator?
00:27:33.200 --> 00:27:40.480
Um that that kids choose not to spend, you know, that they stop themselves, that's a big surprise.
00:27:40.799 --> 00:27:53.440
Um that it that it isn't about deprivation, that it really is about putting a plan in place so that you have purchasing power for, you know, something that really means a lot to you.
00:27:53.920 --> 00:28:04.799
And I think parents are surprised, you know, it's I mean surprised slash maybe a little frustrated sometimes that geez, this this mindful spending tool is really just asking the questions that I want to ask.
00:28:04.960 --> 00:28:20.160
But when I ask, somehow they land differently and and you know, we end up in an argument versus when the questions are on the screen, I guess it feels more benign or neutral, and um, and the kids just go through and answer them, and then you get to have a relaxed, productive conversation.
00:28:20.240 --> 00:28:22.559
So I think those are the those are the big ones.
00:28:23.440 --> 00:28:24.960
Yeah, I mean, that's the thing.
00:28:25.039 --> 00:28:36.960
There's so much, you know, as we've talked about communication, is uh there's, you know, our words are only just a very small percentage of the communication we give.
00:28:37.039 --> 00:28:49.599
And so when you're talking to your kids about these things, you have all these nonverbal factors, you have the history of every conversation you've had with your kid about money, that all these things come into play.
00:28:49.680 --> 00:28:51.200
So it's not just about the thing.
00:28:51.359 --> 00:29:02.160
And I think that's the value of a tool like DIMMS is that the kids able to engage fully on that, and there's not all these other outside factors uh weighing in.
00:29:03.599 --> 00:29:04.480
I think so.
00:29:04.960 --> 00:29:05.759
I think so.
00:29:06.480 --> 00:29:08.000
Yeah, so I mean, who knows?
00:29:08.079 --> 00:29:08.960
That's just my theory.
00:29:09.119 --> 00:29:12.400
So, you know, I'll Well, I mean, we you know, we hear it, we hear it.
00:29:12.480 --> 00:29:14.559
So it's it's more than a theory.
00:29:16.079 --> 00:29:16.720
All right.
00:29:16.960 --> 00:29:30.319
And the thing is, you know, acquiring this habit early in life closes the financial literacy gap, you know, so upstream of other interventions, right?
00:29:30.480 --> 00:29:36.960
You know, right now we have a lot of systems in place to help people dig out of a pitfall.
00:29:37.039 --> 00:29:43.680
Why not create circumstances that allow people, you know, never never to get into the pitfall in the first place?
00:29:43.759 --> 00:29:46.960
It's so much easier to avoid it versus dig out.
00:29:47.119 --> 00:29:58.559
And so when you learn early, pause, gather information, and reflect before you make a decision, you have a much easier time of avoiding, you know, what are very typical pitfalls.
00:29:58.640 --> 00:30:00.000
I mean, you're not alone.
00:30:00.480 --> 00:30:04.559
You know, the reason they're called pitfalls is because they're typical, not because they're atypical.
00:30:05.200 --> 00:30:06.000
Yeah, yeah.
00:30:06.079 --> 00:30:07.200
No, that's that's wonderful.
00:30:07.279 --> 00:30:12.319
And I love that is that it is easier just to avoid something than to dig yourself out.
00:30:12.480 --> 00:30:14.000
That's that's a great word.
00:30:14.079 --> 00:30:17.519
So, Karen, to wrap up, I have what's called the Get Ready Hot Take Trio.
00:30:17.759 --> 00:30:21.200
These are three quick questions to ask all of my guests.
00:30:21.440 --> 00:30:21.680
Okay.
00:30:22.000 --> 00:30:27.680
The first one is what's one myth about spending money that you're trying to break?
00:30:29.200 --> 00:30:35.519
Oh, well, just that mindful spending is is about um is is about not getting.
00:30:35.680 --> 00:30:36.799
It's not about not getting.
00:30:36.880 --> 00:30:44.000
It's about ensuring that you're able to buy what will really improve your life, make you happy.
00:30:44.400 --> 00:30:45.839
It's not about deprivation.
00:30:45.920 --> 00:30:48.960
It's it's really plan beats no plan every single time.
00:30:49.119 --> 00:30:52.640
And planned spending helps you get what you really want.
00:30:54.960 --> 00:30:56.000
And get what you really want.
00:30:56.160 --> 00:31:18.160
I'm just making a note is you know, that is, I think, really powerful that this is not a negative tool, this is a positive tool so that you can uh get the most value from your money is you know, while you know you don't have a scarcity mindset, is sometimes there is a finite amount of money that you have available to spend.
00:31:18.319 --> 00:31:26.319
And spending your money wisely allows you to have more money to save and to invest, and as you said to be happier.
00:31:26.480 --> 00:31:29.440
So, Karen, let's get out the time machine.
00:31:30.000 --> 00:31:38.960
If you could go back in time, knowing what you know now about spending, what advice would you give your younger self, like long before Dems?
00:31:39.359 --> 00:31:44.240
Oh, well, you know, this is this is every grown woman to their mother.
00:31:44.319 --> 00:31:47.119
Like my mother was not mean and she was not cheap.
00:31:47.279 --> 00:31:48.559
She was whip smart.
00:31:48.640 --> 00:31:53.440
And I, you know, it was honestly, it's I know it's cliche, it's such a gift.
00:31:53.599 --> 00:31:54.559
It was such a gift.
00:31:54.640 --> 00:31:58.720
I mean, my sister and I can stretch a dollar like no one's business.
00:31:58.880 --> 00:32:04.559
We have one girlfriend who says that we could meddle in dollar stretching, and she says, and I'm not talking silver and bronze.
00:32:04.720 --> 00:32:11.519
I mean, we'd just, but it's because we practiced our our, you know, the whole time from grade eight forward, we practice.
00:32:11.599 --> 00:32:26.480
And so even to this day, I mean, it sometimes it does drive my husband and son crazy because it doesn't bother me at all to go shopping and come home empty-handed, because I know I'm building the list of like features that really mean something to me, you know, the price point that I'm comfortable with.
00:32:26.640 --> 00:32:33.200
And trust me, when when I see the thing that I've been looking for and I know it's going to do what I need to do, I have no problem waving it in.
00:32:33.359 --> 00:32:36.400
But equally, it doesn't bother me at all to come home empty-handed.
00:32:36.559 --> 00:32:38.160
But that's a skill, right?
00:32:38.640 --> 00:32:40.799
And it's developed over time.
00:32:41.519 --> 00:33:00.400
Yeah, I I I love that is to take your time before making a purchase is, you know, one is sometimes that waiting period, you'll find you don't really want it, is, you know, because there's impulse purchase like at the grocery stores, there's things in your uh the checkout counter that, you know, that you may want to buy.
00:33:00.480 --> 00:33:05.519
But you know, oftentimes if you wait an hour, you go, oh, you know, I don't really want that at all.
00:33:05.599 --> 00:33:06.880
Or you wait a day.
00:33:07.039 --> 00:33:13.759
You know, I know that's something my wife does, is she'll put a bunch of things in an online shopping cart and then go back a couple of days later.
00:33:13.920 --> 00:33:16.720
Well, once she's waiting to see if they'll go on sale or get a coupon.
00:33:16.880 --> 00:33:20.640
But right, the other thing is she'll go, Well, do I really want that or not?
00:33:21.119 --> 00:33:22.079
Exactly.
00:33:22.960 --> 00:33:24.799
So it's a that's a great skill.
00:33:24.960 --> 00:33:31.200
So, Karen, to close out, what's your number one tip to change the way we think about money?
00:33:32.480 --> 00:33:33.839
Ask, does it make sense?
00:33:34.000 --> 00:33:35.039
Not can I afford it?
00:33:35.200 --> 00:33:36.720
Start with does it make sense?
00:33:36.880 --> 00:33:41.119
Because if it makes sense, chances are you're gonna find a way to afford it.
00:33:41.279 --> 00:33:56.000
Sometimes it takes a long time to be able to afford what we want, but it's a lot easier to forego other purchases so that you can afford what you want when you when you're very clear on what it is you need to, you know, fill a need.
00:33:57.200 --> 00:33:58.319
Yeah, I love that.
00:33:58.480 --> 00:33:59.200
That's great.
00:33:59.359 --> 00:34:02.960
Is you know, make sure you're asking the right question.
00:34:03.039 --> 00:34:07.119
And in this case, the right question is does it make sense?
00:34:07.440 --> 00:34:09.679
Not the affordability questions.
00:34:09.760 --> 00:34:14.719
And that's a big part of money and life is knowing the right question to ask.
00:34:14.960 --> 00:34:16.559
So that's wonderful advice to push.
00:34:16.800 --> 00:34:25.360
I mean, listen, I don't I don't want to dismiss, you know, some families are living with, you know, real, real, real scarcity.
00:34:25.519 --> 00:34:29.599
And so that question might strike them as a luxury.
00:34:30.000 --> 00:34:32.400
But I think that there are many families.
00:34:32.559 --> 00:34:33.840
There's of course a continuum.
00:34:34.239 --> 00:34:39.599
And if they would start with that question, they they might take some pressure off themselves.
00:34:40.079 --> 00:34:49.920
And and, you know, this is what we are told by parents and educators all the time that this tool really does take pressure off kids and families.
00:34:50.079 --> 00:34:58.480
And that makes us really happy because we're trying to give them a life skill so that they know that financial confidence is within their reach.
00:34:59.119 --> 00:34:59.599
Yeah.
00:34:59.920 --> 00:35:02.800
And for the adults listening out there, this works for you.
00:35:03.039 --> 00:35:09.599
Is Karen and I have talked about this, is you know, the DIMMS calculator is uh, you know, was created for kids.
00:35:09.679 --> 00:35:13.360
But, you know, if we're thinking about going to the ball game, it works the same way.
00:35:13.440 --> 00:35:28.800
As like, for example, I was thinking, you know, Karen, as you were explaining it, is if I go to the Giants game, I have to buy the ticket to the Giants game, I have to buy a ferry ticket, then, you know, we're probably gonna, you know, it's like if you give a mouse a cookie, then I'm probably gonna want something to eat when I get to the game.
00:35:28.960 --> 00:35:32.400
And then, you know, if I take my son, he's probably gonna want a souvenir.
00:35:32.719 --> 00:35:37.920
And so, you know, we end up spending two or three times sometimes the price of the ticket.
00:35:38.159 --> 00:35:44.559
That's a that's a big epiphany for kids, that the total cost of an event, it's not hard for it to be three X the ticket.
00:35:44.719 --> 00:35:45.679
It's really not.
00:35:45.920 --> 00:35:48.800
And that's a that's a mic drop moment for them.
00:35:49.039 --> 00:35:58.159
And the other mic drop moment I should have said, sorry, if I could just go back and add in is the um environmental impact of mindful spending.
00:35:58.320 --> 00:36:06.800
Uh, we we pull all the kids at the beginning of every workshop and we ask them if they've ever received a holiday or a birthday gift that, you know, wasn't quite what they were hoping for.
00:36:06.960 --> 00:36:09.119
So what do you think the answer is, Tony?
00:36:10.000 --> 00:36:11.599
Oh yes.
00:36:11.760 --> 00:36:14.400
Uh sorry, I I didn't get the full question, but I apologize.
00:36:14.880 --> 00:36:19.760
Have you ever received a birthday or a holiday gift that wasn't quite what you were hoping for?
00:36:20.000 --> 00:36:20.639
Oh, yeah.
00:36:20.880 --> 00:36:21.199
Yeah.
00:36:21.440 --> 00:36:28.800
So 93% of kids that we've surveyed over, you know, we're coming up on 11 years now, have answered yes to that question.
00:36:29.119 --> 00:36:48.239
So if you if we just reduce that number by 10%, so we go from 93% of kids just getting one holiday or birthday gift a year that they don't use or appreciate to 83% of kids, it's 56 less NFL football fields covered in garbage.
00:36:48.880 --> 00:36:49.920
We did the math.
00:36:50.079 --> 00:36:51.440
We did the math carefully.
00:36:51.599 --> 00:36:53.599
And that is a mic drop slide for kids.
00:36:53.679 --> 00:36:58.079
And we are often told that around the supper table, that's what they brought home.
00:36:58.239 --> 00:36:59.760
They were like, and would you believe?
00:37:00.000 --> 00:37:05.760
Because, you know, so many of toys and small gadgets, you know, they have an incredibly long half-life.
00:37:06.000 --> 00:37:08.000
And even they have a carbon footprint, right?
00:37:08.079 --> 00:37:12.960
Very simply, we define that as the amount of uh energy required to produce and deliver something.
00:37:13.039 --> 00:37:16.320
And so you're not giving up anything that you actually use and appreciate.
00:37:16.400 --> 00:37:20.239
You're just giving up stuff that you that you didn't use, didn't appreciate.
00:37:20.480 --> 00:37:26.559
But look at you by default, you lowered your carbon footprint and reduced the number of items you put on a landfill in your lifetime.
00:37:26.719 --> 00:37:31.440
And you might say to yourself, oh, it's one t-shirt, it's one set of shoelaces, it's one board game.
00:37:31.599 --> 00:37:35.199
There are 60 million school-aged children in Canada and the US alone.
00:37:35.440 --> 00:37:36.159
It's a lot.
00:37:36.320 --> 00:37:36.960
It adds up.
00:37:37.039 --> 00:37:40.480
And and you know, it's cooperation is humanity's superpower.
00:37:40.559 --> 00:37:43.840
If we all do our part, we can make a difference.
00:37:45.280 --> 00:37:47.920
We all do our part, we can make a difference.
00:37:48.159 --> 00:37:50.960
Um, I think that's a great place to close.
00:37:51.199 --> 00:37:55.519
Um, so Karen, where can people learn more about you and gifting sense?
00:37:55.599 --> 00:37:58.639
And most importantly, check out the Doesn't Make Sense calculator.
00:37:58.960 --> 00:37:59.920
It's very easy.
00:38:00.000 --> 00:38:04.480
It's gifting sense, G-I-F-T-I-N-G, S-E-N-S-E.
00:38:04.719 --> 00:38:08.400
It's a wordplay, so it's brain sense instead of money sense.org.
00:38:08.559 --> 00:38:12.239
And we're truly permissionless, no registration, no login, no paywall.
00:38:12.400 --> 00:38:17.840
So you just type gifting sense into any browser with access to the internet, we'll pop right up.
00:38:18.480 --> 00:38:19.119
Fantastic.
00:38:19.199 --> 00:38:25.760
And for everybody watching and listening, there of course will be links in the show notes so you can check out that the show notes to get those links.
00:38:26.000 --> 00:38:29.599
Aaron, thanks again for coming back on Get Ready Before Life Happens.
00:38:30.000 --> 00:38:31.280
My pleasure, Tony.
00:38:31.760 --> 00:38:36.880
And thank you, everyone, as always, for tuning in to this episode of Get Ready Before Life Happens.
00:38:37.119 --> 00:38:43.199
If this episode helped you change the way you think about spending, please be sure to subscribe and to share it with a friend.
00:38:43.360 --> 00:38:49.280
You can join the Get Ready Movement at Tony Stewart.com to receive my newsletter and some free resources.
00:38:49.440 --> 00:38:55.599
And if you want to support the podcast, you can now do so at buymeacoffee.com slash Tony Stewart.
00:38:55.760 --> 00:39:00.239
Because when life happens, the way you think about money matters.
