Brett Tanner and Katelyn Mitchell use episode five of their money series to lay out the Be Wealthy spending rules. Before spending, wealthy people ask what their money should protect, what they're willing to look weird about, and what enough means to them. Brett backs it up with hard caps, like keeping housing under 30% of income, and a 30-day delay rule before big purchases.
Brett TannerHost, founder of Be Wealthy
Katelyn MitchellCo-host, runs operations for BrettBrett's first spending question is what you want your money to protect: time, health, optionality, relationships, or peace of mind. He keeps a home warranty purely so his wife can call one number and get anything fixed. The math may not favor it, but the peace of mind does.
Jump to 13:29Brett and his wife Taylor married at 25. By 30, friends were buying bigger homes and nicer cars while the Tanners lived in a house with a $1,000 a month mortgage payment and kept buying rental properties. He told her to give it 10 years, and 10 years later they were past the number he had shown her.
Jump to 15:35Early in his career Brett wrote down a specific dollar figure he believed would change everything once it hit his account. The day it finally did, nothing happened. He says the hardest financial skill is getting the goalpost to stop moving.
Jump to 24:59Rule one is choosing an area, like health, education, time, or family experiences, where you overspend without guilt. Brett's example: if a $300 a month makeup budget makes someone feel their best, that's fine, as long as it doesn't bleed into every other category.
Jump to 30:11Brett uses three caps: housing payment as a percentage of your average income over the last five years (Morgan Housel says 30% max, Brett goes more conservative), a dollar cap on vehicles so a car's sticker price never matches your annual income, and a cap on recurring subscriptions.
Jump to 33:16Brett waits 30 days after deciding to buy a car before actually buying it. For bigger permanent upgrades, like a $75,000 backyard pickleball court, he runs a 12-month test first. He also runs a one-in, one-out rule on things like shirts and Yeti tumblers.
Jump to 37:26Brett's Be Wealthy Optimization Ladder: under $100,000 you protect margin and can't afford loose spending, at $250,000 you control lifestyle creep, at $500,000 you buy back time with help like a landscaper or assistant, and at $1,000,000 you align money with values and legacy.
Jump to 40:34Absolutely nothing happened. Everything was the exact same as the day before and every day before that.Brett Tanner · at 24:59
How Brett says your spending focus should change as your net income grows.
| Income level | What you're optimizing for | What that looks like |
|---|---|---|
| $100,000 or less | Protect your margin | Every decision has to be right, no room to be loose with money |
| $250,000 | Control lifestyle creep | Watch for spending that rises just because income did |
| $500,000 | Buy back time | Paying for help like a pool guy, landscaper, nanny, or assistant |
| $1,000,000+ | Align money with values and legacy | Spending shifts from consumption to taking care of people and causes |
Tap any chapter and the video starts right there.
“There's an old saying that if you get enough stuff one day, your things own you.”
Brett Tanner at 38:28Use the plan tool to turn your own income into non-negotiables, hard caps, and delay rules, the same way Brett built his.
Brett says ask three questions before a purchase: what you want your money to protect, what you're willing to look weird about, and what enough means to you. Without those answers, he says you end up copying your neighbor's spending.
Brett cites Morgan Housel's rule of no more than 30% of your income on your total housing payment, based on your average income over the last five years so one big year doesn't set it. Brett says he personally sets the cap even more conservative than that.
Brett uses delay rules: wait 30 days after deciding to buy something like a car, and run a 12-month test before a big permanent upgrade, like a $75,000 backyard pickleball court. Waiting lets the emotion fade so you can tell if you still want it.
Yes. Brett's Be Wealthy Optimization Ladder says under $100,000 you protect margin, at $250,000 you watch lifestyle creep, at $500,000 you spend to buy back time, and at $1,000,000 and up you align spending with values and legacy.
No. Brett says wealthy people choose their weirdness on purpose, spending less in some areas and more in others. He and his wife lived in a house with a $1,000 a month mortgage payment in their late 20s while friends bought bigger homes, and put the difference into rental properties.
0:00Do you want to have an average relationship? Just do whatever the hell you want to do whenever you want to do it.
If you had to wire in three times what you're going to pay cash for that car, that means you can't afford that car.
There's an old saying that if you get enough stuff one day, your things own you.
Oof.
And I don't want to be owned by my things. Rules are going to beat willpower every single mature wealth doesn't spend louder, spins deeper.
You use money to create epic experiences
with people I love. Welcome back to the be Wealthy podcast where we help real estate agents, investors, entrepreneurs, mo mortgage people, if you even have a touch to real estate or you have a business. We help you make more money and then we show you what to do with it. So, Katelyn, my buddies were just in town and we're out here at Apple Mountain. They came out here to check out the new place. We actually had a guy's trip planned in Cabo.
Okay.
And I had to cancel it because I'm here with you, right? I can't be in two places at once. Elon has not figured out how to do that yet. And so I'm here and I was like, "Hey guys, we can't go on the guys trip playing golf down there, but tell you
1:02what, if you want to come out to Apple in Northeast, Georgia, you want to come hang out here, we'll do it." And so for some reason, it's not the accent of Northeast Georgia that I like to do when I'm here. I like to do the accent of Kevin Spacy in House of Cards.
Oh boy.
So it's kind of a New Orleans.
That's a hot take.
It's kind of New Orleans meets country. Okay.
But you know, so it's just, you know, that sweet northeast Georgia, you know, just a little Georgia Holly. You get out of there, just a little northeast Georgia. So I proceed to do this on the entire 18 holes of every shot, right? I'm going to talk to someone and just it's like talking to them about the strength of their character.
It sounds like you have marbles in your mouth.
Thank you. Anyway, Katelyn, that has nothing to do with today's episode at all. But just an update from golf. I think I just spent three days with my buddies and I lost my mind. But before we jump in today, Katelyn, what we're going to talk about today, how should you spend your money,
okay?
And we've covered in this five, we're on, this is episode five of the money series. The first one, we showed you
2:05where money actually goes.
Then we showed you how wealthy people decide to spend it. Then we showed you what they refuse to buy. Then we showed you what they overspend on. And now we're going to go the be wealthy spending framework. How should you spend your money? And so, uh, Katelyn, we've up to now, we've talked about the numbers, the systems, the pattern, but there's really a deeper problem most people don't solve.
They don't actually decide where they want to spend their money. They outsource the decision.
Okay?
They outsource it to social media, a peer group, their industry, their zip code, just how your neighbors, the people you're around just happen to be, you know, those cars that are in your area. Like, well, they drive that type of car. I'm going to drive that type of car, whatever it is. And so they wonder why money feels stressful even when they earn more money.
Okay?
It's because you're you're not intentionally making the decision. Other people are influencing the decisions that we're making.
Meaning other people are influencing it. You're around it. You're seeing it. It's
3:06on social media. It's at the school pickup line. It's wherever. You're seeing this. And then subconsciously it's how you determine it versus purposefully making that determination.
Versus if you did not have that same set of inputs coming at you and you were if you picked up your home and you threw it in a different neighborhood in a different area and you had a different zip code and used different technology and in a different peer group and you were in a different industry,
you make totally different decisions.
You would have totally but that's completely illogical because in all of that Katelyn was the same person.
It's so true.
But it's it's completely true. And so what we've got to do is we've got to build our own spending philosophy and not borrow someone else's life.
And we're really good as people borrowing just what other people do. And that may be great in some cases. I would just ask you, you test it that it's right for you. So wealthy people don't have more money, Katelyn. What they have is exponentially more clarity.
Okay?
They're completely clear. So the hard truth is most people spending philosophy is I do what people like me to do. Or even worse, I do what other people
4:09Well, I do what I think other people would like me to do. Other people would like me to drive an Escalade. I'm going to drive an Escalade. If you think of it this way, like if you work in technology, you're going to have a spending script around technology.
You're probably going to have some kind of a technology. I was trying to think like, you know, stock guys always wear vests all the time, right? No. And so if you're a stock guy, you're probably going to have a huge collection of vests because you think that's what you're supposed to know. You're supposed to run around and wear a vest and work in stocks. Technology guys, you're going to need a Brett Tanner style hoodie, right? You're a tech guy,
but you're also going to have just every year of your life is going to be overinvested in technology and you're going to spend on it because
hypothetically a cyber truck
because that's where your group, your peers do it. And if you're a doctor and the doctors are all doing these certain things, your spending script matches the doctor's spending script. Then if you live in that neighborhood, whether that's positive or neg it's going to be that spending script of the neighborhood,
right? So again, Morgan Housel, he's
5:11written so many, you know, three incredible books, the psychology of money, which I should believe mandatory reading, where he talks about that our personal experiences maybe make up like 0.1% of what's happened in the world. Like it's like what what we actually experience is just so little of what goes on in the whole world of everything that's going on. And yet it's 80% of how we perceive it works. And so there's this total disconnect. We think we see everything in the world and we only see this little
tiniest little sliver.
The tiniest little sliver ever. But we believe it's, you know, 80 million times bigger than what it is.
And so with that, it's the same with spending.
You see a tiny slice and you assume that it's normal.
Brett, have you ever seen the movie I don't think we've ever even talked about this. Keeping up with the Joneses.
Is it the Joneses? It's the one where um they basically they're a fake family and they are hired to go into specific neighborhoods and sell a bunch of stuff, material possessions, watches, golf clubs, cars, you know, Ethan Allen truck
6:14pulls up and all their furniture comes out and everyone comes over and says how incredible it is. And it's this incredible display of how it actually works for us, right? We're in our neighborhood. We see the Restoration Hardware truck pulls up and it's taken two couches out to go to your neighbor's house and you're like, "Wait, is something wrong with my couches? Should I be getting these new couches?" Now all of a sudden that's the standard of what you think you need and you weren't even thinking about it yet. I I know Brett just said there's a book you have to read. I think that movie, which Cole, we'll put that in the show notes, right?
You'll put them down below in the show notes. Yeah, perfect. I think that movie is worth watching because it's exactly this. You can be manipulated consciously or subconsciously by what's happening around you. And to your point, it's the tiniest little sliver, but it's so easy to allow it to penetrate into your world and determine your spending decisions moving forward. You know,
it's crazy.
You you think about this. Someone goes to work, they have a brand new car, they're driving to work, they feel great
7:15about their car, they're 90 days owning it, someone else the office gets a brand new car that's a little cooler. just just yesterday you loved your car
and now you're like I don't know if I like I like that car maybe a little better and now you're not as happy you were because what does that have to do with anything? Nothing. You didn't even know they had but they got a car and so now you're thinking differently about it. And so if
your subconscious is incredible
the point I'm making is if you're copying someone else's spending is the fastest way to feel behind forever. Mhm.
If you want to feel behind, copy what someone else is doing that you don't know who is and you'll always feel behind. And so the the thing I want to point here, the way you should spend your money is the way rich people do is by being weird. Rich people spend their money in very weird ways. They're absolutely weird. And when you look at how they spend their money and you study it, you might even look that they're crazy and consistent. That would be the words my wife would use to describe me. She would say these exact words if she was here. Brett, you are the most frugal person in areas of your life. Like
8:17frugal in a way that is unbelievable and lavish in a way in other things
is also unbelievable
and it makes total sense to me. Right? My example would be and I think it's this is from the golf the other day. Things that I don't even see. I had a golf glove that apparently the entire back of it was coming off like it was ripped. It was missing its thumb.
It It was on the back part only. On only for in fairness,
it had a little cap that came over your thumbnail
and it wasn't even affecting it. And so this thing was
You couldn't possibly grip a car.
And so
and it turned blue.
It it is this is this is a this is an example.
This is a hot topic, guys. This is a big thing that's happening here.
This is an example of where I'm literally going, I'm fine. Now Russ gave me other glove, which was so amazing. And it it turns out there is a different grip when you don't have one that's like form fitted to you where you have to put your hand in a certain way. But my point was
your glove was paperier-mâché. Can we just say that?
9:18
My point is that even my my golf shoes are a little older and nastier than I think most people's golf shoes cuz I see no value in them. Like they they
they do the job. They're doing fine where you know again I've got buddies that they've got the matching belt and teeth and you know shoes and it's a whole get up. And I love that. I I just think that when you study the truly wealthy and I'm not putting myself in that group. I'm merely just saying they're cheap in areas, they're shockingly generous in others and I the person watching them is unclear to me. I didn't see the glove to be honest with you. I just go it's not even on my radar of just things that I even see. So it goes down to philosophy and the philosophy is right in the millionaire next door they talk about the difference between producers and consumers. Right? Some people are built to consume.
Yep.
And some people are built to produce. Right. So when you get confused on the wealthy, right, they're some people are optimizing for appearance appearances and some people are optimizing for outcomes.
I love how you you've shared this with me a number of times and it's if no one
10:21else knew that you were purchasing that, if no one ever saw it,
you could never tell them.
You could never tell them. No one would ever see it. Would you still buy it? And if the case is yes, if it brings you incredible joy, you know, you're wearing a sweatshirt that you wear all the time, right? You would buy that sweatshirt. Most people would say,
I even want this. This came from you. Uh the most expensive gift that I gave,
Katelyn is my most expensive friend. What I mean by that is she gave me this hoodie about four years ago.
Correct. And I said, "It's going to be weird that I'm giving you a piece of clothing.
It's going to be very weird." I said, "I don't find it weird at all." And you go, "You love hoodies cuz I wear a hoodie every day." But so it the reason though right is it optimiz it is the greatest. This is the same one that you gave me and I've had it now four years later and it looks like it's still like it's new and it it it I love the way it feel. I love the way it looks and if I never I could care less if anyone likes it.
I love it.
Then that is worth spending your money on
it. Anything that brings you that much joy that you're going to but you love it because you love it is the reason why. Correct.
So you know Warren Buffett if you're going to study anyone with money you got
11:22to study him. So he lives in the same house he bought a long time ago. He will deploy billions of dollars in a company without even without even questioning it. And yet the home that he bought was about less than 3% of his net worth at the time when he bought it when he was 26 years old. Still lives in the same neighborhood. This guy's not optimizing for status. He's investing his capital. So wealthy spending looks weird, Katelyn, when you don't understand the rules behind it. Okay. There's three things. There's three questions that shape our spending philosophy. Okay, before we go to tactics, Katelyn, wealthy people ask these three fundamental questions.
Okay,
so first one, what do I want my money to protect? We're going to spend money, Katelyn, what are we protecting?
Most people's money's job is to buy things. Just want to go buy stuff, stuff and things. Instead, wealthy people say, "I want to protect something fragile is another way to think about it."
Okay.
Okay. Okay, I'm going to give you some I'm going to give you some ideas to get those wheels turning for our listeners and viewers, which is time, right? How
12:25do they want to protect their time? How will they spend money to protect their time?
How will I spend money to protect my health?
How will I spend money to protect my favorite word of 2026, Katelyn, without even saying it, what is it?
Optionality.
Yes. How will they protect options?
We talk about optionality a lot.
But they spend money to keep their options open.
Correct. they would pay a premium to have an extra option as a choice to
your reverse 1031 exchange is the exact portion of that.
A reverse 1031 is you're paying a premium to give yourself
a very specific example. It's a great example.
You're paying for the opportunity
to it gives me way more options as if I do a forward exchange. It's much harder to do.
You're okay. They're spending money to protect relationships.
It's a partner, right? relationship, your kids, people you care about, your business partners, your key staff, and they want to spend money to protect peace of mind. Notice none of those things, time, health, optional relationships or peace of mind were stuffing things. We were just talking just just a few minutes ago around the
13:29fact that you have a home warranty
and that most people would say economically is that the right choice but you have it for the peace of mind that such your wife has the ability to call one number and get anything fixed right that's the peace of mind but most people would say economically is that the right choice for you you're willing to pay for it for the peace of mind
I actually will tell you what even if they I if it was just a service where I could call one number and they would just send someone out for a variety of trades I mean, I would buy that service totally for peace of mind.
Totally.
You know, just peace of mind and time.
So, we've got to think about what are we trying to protect in our lives and then spend money that way because we're going from not just spending randomly, we're spending purposefully. If you need help in your business right now, you've got a challenge or an opportunity that you really want to hone in and capitalize on it and make a gamechanging breakthrough in your business, come out to our one-day workshop. This is something we've never done before. We're now doing them at the resorts we've bought. So, they could be at Apple Mountain, Georgia. They could be in northern Arizona. Um they might even be in Bise in the future. But you get to come to a one day where there I'm not going to present slides. It's literally you and
14:32your business and you're going to leave with an action plan you can implement in your business. Go to bew wealthyodcast.com and you can click on our upcoming events and see where we'll be and book to come. We have the room is limited. We have no more than 15 people in the room. Go to bewealthypodcast.com and you can book our one-day workshop coming up. All right, Katelyn, we got to get to question two, which is really, what am I willing to look weird about? And you know, I've told you if you're going to be successful, you're going to be weird. And what I mean by weird is people are going to look at you differently. And look at you differently because you're going to be perceived as their peer doing the same things as them. So you should be spending money and acting in the same manner.
So every strong personal philosophy around your money, how you spend your money is going to have a cost. So, Katelyn, you're going to be underspending in areas of your life where others are overspending because you're different. You're going to be saying no when others say yes. You're going to be skipping things that people would expect you to go to. So, they're
15:35choosing their weirdness intentionally. Let me give you an example. So when Taylor and I were married and we were probably about five years into our journey, a lot of our friends had started, you know, so now we're we got married when we were 25. So at around 30, many of our friends had were buying bigger homes and nicer cars and living these bigger lives. And at that point in time, we lived in a very modest home that some I mean, not some, everyone would say that it was a very I mean, it had like a thousand dollar payment on mortgage a month. It was an average neighborhood. And I didn't even I was I knew it was a future rental property. So, I wasn't even thinking like in my mind, we're just out there buying these other rentals everywhere and this is the answer. And so, we were spending all of our money to buy incomeroucing assets for the future that we wanted. We were we were making decisions and so we were looked at as weird.
But you couldn't do that if you had matched everyone else's spending because you had to spend less than you made to
16:38have that delta to go and invest in. But instead, everyone else is grabbing the new car, jumping into the bigger house, joining the country club,
and they were taking and taking vacations. So they were overspending. Their lives looked unbelievable. And I would say I was just more in tune with just I was so one like linearly focused on I'm buying a bunch of houses because I got to get passive income. I gotta get money working for me then I have to go work for correct
at some point that'll be more than what I'm spending and then I'll be freedom and so I was just tied to that you know but my wife would look at her peers
and other you know wives and would say hey babe I mean why are they living like that? Are we okay? Like why do they live like that? And I said, "Oh, because they consume 100% of what they have
and we're just on a different journey. There's no judgment in that journey. We're just I'm" And I I made a comment to her. I said, "If you give it 10 years from today, I I can tell you where we're going to be." And I just showed her and I was like, "We'll be there." And she's like, "Oh my gosh, that's so much." I'm like, "Yeah, we're going to be right there in 10 years." Because that's how money
17:40works. It compounds.
Correct.
And
it's a mathematical equation.
We knew now it was better than the number I told her. You know, in 10 years, I got better and the businesses performed better. this compounding thing like we were able to get better people and get business with all of these great people which helped the companies go faster and then it was 10 years later she's like wow it it happened and you were right I said the gap in 10 years we will be so far from where we were they won't understand what happened and right and we're living that today right in our lives and and again we're very private about what what we do and how we do it
but it looked weird
we were under spending in all the areas that others look that I didn't go on vacation. I barely traveled. Maybe once a year, Taylor and I would do something, but you know, I was just it was all in on growing the business and the thing. And to where now, you know, I start my year at about 12 weeks a year that I'm going to be off traveling, you know, with my families. And now I've even gone that way.
I've gone to the extent we're buying resorts now just so I can go to cool places and go do more fun things. But it
18:42was I had to pay the price to get there. And I looked really, really weird. So when I say weird, what goes through your head as we as we think about being weird?
Well, you and I have talked about this a lot. I think that we live in this era of CEOs are like professional athletes, right? So we look at it, you and I have our f you're one of your favorites. You are on the Eli Elon train.
If we're trying to go to Mars, I'm going to root that guy on. That seems
If you're trying to make humans an interplanetary species and that's your life's mission,
it seems like let's root for you. I got to be honest, that's not something I'm solving. And I'm like, I I don't understand. I'm I'm for it. I get it. And you also want to put internet in the sky that just works better.
And then give it to people who are in need because there's a war in their country.
I I got to be honest. I I like a I'm not saying I agree with all of it.
Sure.
And then I think he made the greatest car ever created. And I'm a big fan of the the Model S Tesla. I'm just going to get let that guy back. But yes, I'm a huge fan of him from all areas. I think today we look at CEOs and we see that I think everyone would agree Elon's a
19:47little bit different. He's a little bit weird, right?
A little bit.
Yeah.
Like,
however,
way weird. I think that we have developed this uh hero complex around CEOs where we're looking at them and saying they're weird and instead of always looking at what were his financial or work habit behaviors that were weird that produced this result, instead we're looking at things that are not that. Meaning, you know, you wear a lot of black clothing.
I wear a uniform. you wear a uniform so you don't have to think about it and that you're always comfortable in what you're in, right?
I literally it just eliminates the decisions. I I know if I put on a black pair of shorts and a black hoodie and a black shirt,
I don't really I'm not going I wonder what I'm going to wear tomorrow.
But let's be clear that wasn't because you were trying to be like Steve Jobs that you made that choice or Gary Keller, right?
Well, in fairness, I was trying to be like Gary Keller, but it's not why I did it.
Yeah. But it wasn't why I I didn't choose I just chose black. So I was
20:48like, you know what? I just like it. And he happened to also like it and then I made it a bit about that. But no, I do it because it was for me.
I bring this up because I think a lot of people when they're like, "Oh yeah, I'm going to be super successful, so I'm going to be weird." And they start picking things that are a symptom of what other people who are uber successful have done. And they're like, "You know what I'm going to do? I'm only going to drink red Kool-Aid." Right? And it's like so and so drank red Kool-Aid. I drink red Kool-Aid. I know you look at me like I'm crazy sometime. I'm not drinking Diet Coke because Trump drinks Diet Coke, right? I'm not making my choices because of that. But I think people out there are. So, I know this is a weird rant, and I'll this will make sense in a second. I think people are looking at uber successful people and saying, "They're weird, so I'm going to be weird." And they're picking what I'll call the symptom of their weirdness, right? rather than saying what are the nonsexy things that they're doing that are achieving those great results. So here
21:51we're talking about financial disciplines, right? We're talking about how are you choosing to spend your money and where are you looking to spend your money and weird results are happening? In previous episodes, you've talked about how am I choosing to do my work when my work happens and how do I optimize my performance, right? There's going to be weird things that are symptoms that allow you to do that better, faster, more efficient, more effective. But let's be really careful. Are you being weird to say that I'm cool and I'm weird and to get attention for it? Or are you being weird in the things that are actually going to achieve the goals you're trying to? Is it the tail that's wagging the dog or the dog that's wagging the tail? Which is it? And I think a lot of us, a lot of the chatter that I hear is the tail that's wagging the dog versus the dog wagging the tail.
It's it's really really good. So you're you're not trying to be weird to be weird because you think it's cool,
right?
You're weird because it's so far out of the norm of what others are doing.
22:53
Correct.
And if all you have to do to be average, Katelyn, I'm going to give you this little playbook for average.
Oh boy. Okay. All you have to do is do whatever you want to do whenever you want to do it
and then you get to be average.
You will you'll land right in the middle. Okay?
I mean I mean like with your money, just do whatever you want all the time and you'll be average. If you want to have an average relationship, just do whatever the hell you want to do whenever you want to do it.
Your partner's not going to love it. You're going to have an average, maybe slightly below average in that case, but you have an average marriage. And you know what? of you want to have an excellent marriage. Sorry, honey. Sometimes you're going to do something that you don't want to do when you don't want to do it.
I'm going to go to the farmers market with my wife. Farmers market's not really my place. I'm going be honest with you, Katelyn. I don't want a windchime that's painted like a duck.
I don't want it.
Not shopping for rhubarb.
Maybe I want some rhubarb or some, you know, like, you know, gluten-free something. I I just, you know, all that's awesome. That's just not my thing. But it's going to delight her.
My wife wants to go to it. I'm going to
23:55tell you, I am shot out of a cannon to get some rhubarb now. Now it's like, let's go.
Let's see how much rhubarb we can get. What kinds can we get?
Are there multiple rhubarbs? Can we get I mean, can we get all of them? And so I'm going to say it's going to be weird, right? So we you've got to think about where could I be weird under spending where others overspend to scratch my own itch.
I love it. Where can I say no when I say yes as when it comes to money and where can I skip things that people would expect expect you to do? Third question we all got to think about Katelyn. What does enough mean for me?
What is enough mean if you're going to spend? We've all got to get there because more right if the targets moving right Morgan Housel talks about in his book the psychology of money. One of the problems we have as our goalpost financially moves in life as we get closer to it. I needed to get this amount of money in passive income. I need to get this income and I'm getting closer to it. And as I get closer to it, I want to move it further away to a higher number that's more. And I will tell you in my life
24:59that was a problem for me.
Okay?
I was in the pursuit of more for a long time. And I had this number written down, Katelyn, when I was I first started my career. And I wrote down this very specific number. And it was amount of money that I wanted in a single account. It was a huge amount of money and I personally believed that when that amount of money was at account like I'm this is a real thing. I believe that somehow not in reality but like metaphorical fireworks would shoot off
and you'd achieved it all
and doves would get released and all the problems in my life would just dissipate and it would all be easy. That's what I believed. Okay. So imagine the day before I'm like I'm pacing it's most likely tomorrow and then the deposit and it's in the account first time and do you know what happened? Absolutely nothing happened. Everything was the exact same as the day before and every day before that. I was no different. I wasn't all I was was disappointed that doing that wasn't the answer.
And because I believed that represented enough but the minute I had it wasn't.
26:03it was now no longer enough and I needed more than that to do it. So I had to I had to change how I did it. And so figuring out enough in a certain area.
Okay.
So it's the hardest one to do here because our culture, right, is I mean the culture of America today is just more,
right? We are more for more sake. The hardest financial skill, Morgan Housel says, is getting the goalpost to stop moving. If it's undefined, spending will never feel complete. If you don't define enough, lifestyle will define it for you. You know, we go in our training rooms and you I go across the country and sometimes I'll ask, you know, the audience, I'll say, "Hey, who in here has got a family of four?" They'll raise their hands and I'll say, "What does it cost you approximately a month to live?" $10,000. And then I'll say, "Who in here has a family of four that they spend $20,000 a month?"
Someone raises their hands.
And we go, "Wait a minute. same city, same industry, similar age as kids, twice as much per month to live in the same town. This lifestyle, right? Just
27:06the goalpost is moving more.
And so we've got to change if if we start thinking, we didn't tell people anything to spend money on. We're telling them how to think about it. Morgan Housel's newest book, The Art of Spending Money, is a similar concept, right? How can we have because it's an art, but what you and I are talking about here isn't science. It's not spend more on cars and less on this.
It's a mental paradigm.
It's a mental paradigm. You've got to figure out what's right for you by asking yourself the three questions. What do I want to protect? What am I look what am I willing to look weird about knowing you're going to look weird? And what does enough mean for me? Look, if you're out there and you're a real estate agent and you're having success, but yet you don't feel like you're successful. You're making $500,000, $700,000 a year. And you're asking yourself, where does the money go? I don't have the time. I've got I'm trying to be at home. I'm trying to be with my kids. I'm trying to have a big career. And you just feel like there's you're missing something. I think it's because you are. And if you come to our one-day workshop, you can see the testimonials on our website. Go to be
28:07balthyodcast.com. Come spend a day and let's show you a different way to play the real estate game that helps you hit your goals. Go to bewealthypodcast.com. When is enough enough? So, let's put this into practice. Wealthy people don't make every decision from scratch. They live behind rules. They build models.
Okay?
You know, and I was blessed that my coach, mentor, and friend Gary lives in his entire life is a model. And if you have a question about anything, it's a model. And the reason he builds models is Katelyn, then you know how to make a decision. you have any input comes in, you're like, "Oh, does that fit my model?" Yes. No. If it fits my model, I make a decision. If it goes against the model, I vet it and see why. Do I want to now change the model or am I leaving it alone? So, basically, it's a better way to make decisions. I've got a model for the food I'm going to eat every day, and I've got a model for how many steps I'm going to get in. I've got a model for how I compound my money. I got a model for how I compound my skills. I mean, I got a model for my relationship, my kids, my wife. I have a model for my relationship with my partners with you. How I make decisions. All of those are modeled.
29:09
So, what are the models for how we should spend our money? Rule number one, non-negotiable spends.
Okay,
everyone get your notes out, pull off the side of the road, and stop what you're doing. And before you go to your notes, leave us a review. Your reviews are the fuel that flies that that just lights our passion. Nicole just clapped in the back. If that's how important that's how important reviews are, is that someone will clap in the back and you might even hear it on air, Katelyn. That might blow your mind. So, leave us a review. Please do. We This is our labor of love. We want to share this with more people. So, first thing, you pulled it over. You left the review. And rule number one, non-negotiable spends.
Okay,
Katelyn, this is where you can overspend without guilt. So, I'm going to give you areas to think about your health, education, time, family experiences. You pick it. It's non-negotiable. Pick the amount, the category, and you get to go there. If your thing is, I want to have the greatest makeup in the world because it makes me feel like the most beautiful girl in the world. And you define that monthly and you say that's what I need and it makes me feel and
30:11that gives empower. Bam. $300 a month. I'm I'm all about it. That doesn't bother me. Now, you can't do this in every area of your life, but your your thing you could pick it. But where do you want to overspend? So, let's define the non-negotiable. And then there's no guilt attached. If your thing is, I want to have this weird goofy gym membership where I do some weird bar Pilates cold plunge
hang upside down spin.
And if that's your thing,
you're an acrobat. You just lose yourself.
Do it.
Yep.
Do it without guilt. Everyone needs a thing. But once you decide, you stop debating it.
Okay. and we're just trying to reduce decision fatigue and regret.
So, you need a framework for it. I'm going to spend on this. I'm not going to feel guilty about it and I'm going to cherish and enjoy it and move forward. You can do that. You're not saying to live the most frugal life in the world where you don't spend any money and don't have any joy.
No. So, this is where Dave Ramsey and I disagree.
31:12
Find your freak flag is what you're saying.
I am saying find your freak flag and your 17 points of flare and get out there, sister, and go do it. What I'm saying is Dave's gonna tell you live cheap for cheap's sake. And Katelyn, if your thing in Starbucks and getting a Starbucks in the morning and that lights your life up, do it. We'll find another way to make money. Now, it can't be all again that if that's your thing,
it can't be everything.
So, we're non-negotiable without guilty spend. Pick your thing. I think ideally be one of those categories, health, education, time, family experiences. But if you've got something else and it's your thing, it's your thing.
Love it.
Number two, we got to have hard caps. These are categories with ceilings regardless of income. I want you to think about caps as your house is a percentage of your income.
Okay?
And when we say your income, the average of the last five years.
Ooh, this was a hot topic.
I am not going to let my house be x percentage of my income. Not more than x. Just define it.
Okay? Not a crazy thing. Morgan believes it should be no more than 30% of your income, your total housing payment. I even think that you should be much more
32:14conservative than that because I'm a very conservative person. But we got to pick. There should be caps. How about number of vehicles?
I would say number or dollar amount of vehicles. You I remember we were It was one of the times that I had first started working with you and we were working on running the brokerage down in Tempe, Arizona. And you said, "Come out here with me." We walked out into the parking lot and I'm not going to obviously name names, but you said, "What really surprises me is now that I can see the production value and dollar amount that people are making when their car equals the value of their car, the purchase price, the sticker price of their car equals the same amount that they make in a year. I have a million questions."
And he said, "So do me a favor. Let's really look and help people to start making the right decisions." Then you started teaching wealth in the market center and and changed a lot of people's lives. But we walked outside and you're like, "How much do you think so and so makes in gross commission income?" And then you're like, "And then what do you think the sticker price of this car is?" I was like, "Brett, I never really
33:16thought about that. You you don't think there's something wrong with that? Your car should not equal your total gross income for a year."
Never. Ever. Ever.
Period. That math doesn't work. So what you're saying here is come up with the model. Housing is a percentage of your income average over the last five years because you might have a gang buster year one year and boom you go out you buy the $2 million house and you put your family's financial health in jeopardy. Number of vehicles I think is so generous. I'm like a one for one on this. A lot of people I know multiple vehicles. Cool. But if it's your thing and you want the 56 Mustang and that's your that's your one overspend, go nuts. Lose yourself. But you're saying
if you can afford it.
If you can afford it,
but you're also saying we don't need to go and have 12 cars because we just really thought that the new, you know, whatever that car might be. I'm obviously not a car person. I
we got to limit that then. And even like we've got to put hard caps on number of reoccurring subscriptions.
Oo, this is a leaker.
34:18
These are hard caps because it it again, if we don't set this,
it's going to be more and more and more we can't. You're hypothetically saying Hulu, Netflix, HBO, like if you have 12 of them, why
all of it from I'm going from a gym membership down the line. I'm going all your reoccurring subscriptions,
we got to cap the total.
You can only have x amount of stuff that's just charging automatically every single month. It can't be an ever growing am ever ever growing amount.
So caps, what they do by putting this hard cap in, it protects your margin automatically.
Okay. But just by doing this, we we've decided we're going to have by putting these caps in, Katelyn, you're going to be left with extra money that you could use to get ahead in your future and invest in yourself.
It also liberates you. The ability to know when to say yes and when to say no takes all this like guilt, pressure, and all this stuff that constantly exists and you feel in turmoil, right? You're like whiplashing yourself when you're trying to make these decisions. You're trying to be fiscally responsible. You don't have a model to say no. And so every decision becomes emotional warfare
35:21for yourself or at least for me, right? But if I have a model that says I can only have x amount of reoccurring subscriptions, my car model, when I choose to purchase a car, you tell me, which was great advice, Katelyn, if you can't pay for the car cash, that's one thing, but more than that, if you if you had to wire in three times what you're going to pay cash for that car, that means you can't afford that car. Well, boom. you now gave me a subscription model versus like, oh, my lease payment's only $100 more, now I'm in emotional turmoil. Right? If you can put models around this and rules around it, it takes the emotional warfare of deciding what to spend money on or what not to spend money on totally away. And so, this is what you're doing. You're giving us the guard rails to stop the emotional spending and the leakage so that we have money to go and invest. Go figure.
Katelyn, I'm going to say it this way, right? Saying yes to something's easy. Saying no to something's easy. It's the may that are hard. Should I get a more expensive car? Maybe. Well, maybe it'll
36:23maybe I'll just increase the payment. Maybe I And pretty quickly you could
you could maybe yourself.
So, we all as people, right, we make an emotional decision and then we back into it. Logic.
The way you're going to get to that bigger house is like, you know what, can't we're going to have I mean, down the road you're talking to your partner. We're going to have a bigger family.
We should here's what we should do. We should
I'd love to entertain. We should get rid of this thing right now. We should get the five bedroomedroom, the big yard.
Let's lock it in now.
We just should do it now. It's coming anyway.
What? And you're like, "Wait a minute. We just went from a 3bedroom, two bath, 1500T house. Now we're we're 5,400 ft on an acre for 1.5." Honey, how did we get here?
And you think you need a dining room for 12 people. Help me understand.
So, it just we got to have hard caps.
Hypothetically.
Yeah. All right. Next thing, next rule. Rule number three. We need delay rules. Wealthy people use time as a filter. Here's an example. Delay the purchase for a period of time. You can set the barriers. One could be if I'm thinking about buying a new car, I have to wait 30 even I'm ready to go. Got to wait 30 days after I make my I make the decision
37:26I want to buy the new BMW and now I've got to wait 30 days at the end of the end of day 30. If I want it, I'll do it.
As an example, by the way, you'll want it in the emotion in the moment. And you wait 30 days and you're like, you know what? I kind of like my car again. I don't even care. I'm fine. Right? Like you you might you might get to that place.
So true.
How about a 12-month test before permanent upgrades?
What do you mean by that?
You want to put a pickle ball court in your backyard
and you're going to spend $75,000 doing it.
This is all hypothetical.
Hypothetically in case you know you've done this and I nailed the number that it costs. So with lighting and everything by the way in that number. Uh but you think about that for 12 months. Is that something we really need?
Okay.
Yes. Yes. You know, turns out is something that we had to have. You know, we couldn't go.
Your family was willing to do the way you had to have it.
It was something. And I got to tell you, the amount of joy it gets used. I mean,
well, because you guys knew you would use it.
Not you guys. I mean, one of us doesn't use as often as the others, but it's a good example. And so, what about this? What if there's a onein oneout rule?
This is my rule for myself.
38:28
I got to tell you what, as it comes to for Christmas this year, you know, my wife, I I say, "Please don't buy me gifts. My gift that I want is your love. winning right now. Winning with that one, honey. No, that is what I really want. I don't need a shirt or some stuff. And so I say, "Honey, please." So, should you give me three or four shirts? I say, "Do me a favor. Just take it all back and just I have what I want." And I go, "The reason, honey, I don't want to do it is because you get there's four shirts there and I have to go get rid of four shirts."
Not because my closet isn't big enough. I don't want more stuff. More stuff drags you down. Katelyn, there's an old saying that if you own enough if you if you get enough stuff one day, your things own you.
O.
And I don't want to be owned by my things. And so if I've got four shirt, I got to go I got to go take one out. If I get one, I got to take one out. If I if I have this is this is water in here and I've got like my four Yeti tumbler and I'll go to some place and they give me a tumbler and the fir I'm going to come home.
I don't want it.
I I want it because I'm going to replace it and I'm going to take one of these and I got to give it to somebody and get rid of it because I I don't want to have 37 of these.
Agreed.
And unmanaged it will grow to So I want to just be thinking one in one out. But
39:31now thinking about what areas of your life can you apply it to? Right. There's so many areas. So time, if we put delay rules in place, time reveals whether the desire is real or emotion. Okay. Rules are going to beat willpower every single time.
Yep.
Every single time. All right, Katelyn, I want to move to your philosophy. There's spending philosophy that we're nailing today. It will evolve and should evolve as your income changes.
Okay.
Okay. So, it's not static. It's going to change. Most of us make massive investments in our business and some of those investments don't pay off. So, you can come spend a day with me for $997. You come out to one of our resorts. You're going to spend a day, bring your challenge, bring your opportunities, and let's work through it in a one-on-one coaching session. You're going to be in a room of your peers. No more than 15 people are going to be there, and I'm going to coach you personally to tackle your challenge and your opportunity. Go to bewealthypodcast.com to see the next dates for our event. But it also shouldn't flip every time your income rises either. So, we want to think about the be wealthy optimization
40:34ladder. And if you go back and listen to the prior episodes, you'll be able to walk through what the wealthy do spend money on, what they don't, and our whole methodology around it. But we walk through those different income categories. Katelyn, if you remember, they were $100,000, $250,000, 500,000, a million dollars. Those are net income numbers. And so, at $100,000, you got to make every decision right. You got to protect margin. You do not have margin of error to be loosey goo. We got to be We got to nail every number.
You were going to say loosey goosey. Loosey goosey goosey technical term in the financial world 100k and less you cannot afford to be loosey goosey
when you're out here know all these jewels you not be loosey goosey so so when you get to 250,000 Katelyn it's lifestyle creep we're trying to control like that's what we're thinking that our philosophy goes from margin protection to lifestyle creep control at 250
at 500,000 right we're spending our money on different things so at each one of these income brackets We're spending the money differently.
Each of the the rungs of the optimization ladder.
41:36
So protecting margin, spending money to protect margin is different than from controlling your lifestyle creep is different from at 500,000. You're buying leverage and time.
That's where you're going back and getting all your time back by saying, "Hey, I'm going to have a pool guy landscape nanny or whatever the things are to get to just make my life better and get my time back and get leverage. I might be a new assistant or better tools, better software." In a million, we're aligning money with values in the legacy, right? We're saying, "Hey, I'm going to leave a legacy behind to people and I want to take care of some folks in a very specific way. I've got the resource to do that." Right? So, it changes where you go. So, Reid Hoffman, as his wealth grew, his spending didn't explode. What changed was his impact. So, money shifted from consumption to amplification, right? So, he wanted his impact to be greater.
Okay? Okay. And so in his stuff and things, right, he was investing in his team as an example, the work like he there was a time where he was overpaying for the role that he could have got it done for something else, but he wanted such an a player
because he knew where he was going.
I know where I'm going. I'm going to overpay for that.
42:37
Sure.
Right. So I'm over I'm spending money on greater talent for my business. Right. So I get I can win greater games because I got better people.
Sure.
And I'm doing it with and it's a bet instead of consuming it on
I'm going to get a new Ferrari.
I'm going to get a better office building that looks cooler. Oh, let's get the let's keep the same crappy office and get better people and drive our results up. So, mature wealth doesn't spend louder, spins deeper. One of the analogies I always give, Keelen, you go, you I make this joke and I'm like, you imagine that piggy bank and if you put two nickels in it and you shake it, it's really loud. And when you take that piggy bank and you shoved every nickel in it and it's so full and you shake it, it doesn't make any noise. And that's how wealth actually sounds like. Yeah,
it's real quiet and online you can get lost because the two nickels shakes around and it's really really loud. And so I want all of our listeners to make the statement, the spending statement real, the be wealthy spending statement. So every listener should
43:39complete this sentence. I use money to blank and I deliberately underspend on blank.
Can you give me some examples to that?
I can. I use money to buy time and health and I underspend on status.
Be a great one that everyone should write down. I use money to protect family flexibility. I underspend on luxury. If you can't articulate this, spending will always feel reactive. So, Katelyn, I use money to blank and I deliberately underspend on blank. One that I hear you you say or allude to a lot is you use money to create epic experiences
with people I love
with people you love and you deliberately underspend on stuff and things.
I would I would say I I use money I way overspend on epic experiences of people I love because it's my life's mission and I radically underspend on things that give me status and stuff and things.
Completely.
Yeah. Completely. So we went through five different episodes. showed where we
44:43spend money, where the people decide, what they ref what they refuse to buy, what they overspend on. And today we talked about how the art really our art of your spending framework
and this really is our be wealthy spending framework. It's not about copying rich people. It's about building a system you don't regret living inside. And once you have a spending philosophy, Katelyn, money is not emotional. Decisions decisions get easier and wealth compounds quietly. again quietly as Katelyn any thoughts as we've went through our entire series where there's one more in the series which is really about how do people how do wealthy people raise their kids with a healthy relationship to money so that's next week but Katelyn any any parting thoughts as we wrap it up right now
the key for me is money's emotional the way people spend money it's super emotional right it's FOMO you're missing out on something or you want someone to think something of you Typically, our money tends to be emotional in the way that we spend. And I think that if we
45:48one of the gifts that you gave me was a different way to think about it where I'm able to make noneotional decisions when it comes to money. And that's from investing to spending to safety and security. All of those areas, you should have a model around how you do it, right? Like we've talked about personal spending here and how to have the model around that, right? And that's money. But it's also you should have those same models around how do you invest? How do you provide your safety and security? So what you've given us over these episodes is really the framework to then go back and determine our own personal framework. How does that work for us? And how do I align my household in that same exact framework? It should be from top to bottom in your home. Your kiddos know exactly how you think about spending money and they make the same decisions, right? They know where you're going.
That it is uh it is 10,000% that way. And go out there. We've got to know why we spend the money the way we do. We've got to we've got to build our model. That's Katelyn Mitchell. I'm Brett
46:52Tanner. That's a wrap for Be Wealthy, our podcast. We will see you back here next week. Go out there and be wealthy.
One day in the room with Brett on your real numbers. You leave with a 5-year plan.
