#1597 - 3 Places Your Money Is Going

If you're listening to this , on the day it drops three places your money is is going . We , as we mentioned in a previous episode , health , wealth , life and love . Those are the pillars of next level university and I realized we don't talk about Money , wealth , making money , whatever it is , our relationship with money as often as we do other things .

So Alan and I were talking and I said what do you think we can do for a valuable episode on wealth , on money ? And he said actually , emilia and I were having a conversation and I think that would make a very good podcast episode .

So I'm gonna kick it to Alan because this is Alan's well , alan and Emilia's framework and we'll see what comes of it also known as shmoney shmoney , shmoney shmoney .

So we had two clients who are looking to buy a home and the road to their home , their dream home it has been paved , so to speak , in advance , and we've got a timeline , we've got a down payment , we got all this up , but what we needed to do first and foremost was there's there's two main ways to to Make more money .

You can make more or you can save more . Essentially , we talk about the three fundamentals how do you earn more money , how do you lower your expenses or optimize your expenses , and then how do you invest the difference ? So in this case , the investment they're looking to do is the home . They are already earning as much money as they can .

They're picking up extra odd jobs . They're they're dogs sitting on the side , they're house sitting on the side , they're doing all kinds of cool stuff , and then they're also . The one we're gonna focus on in this episode today is optimizing expenses , and so Emilia had this whole spreadsheet set up for her clients . She does this with her one-on-one clients .

She also does this with , obviously , relationship talks , coaching , clients , and the spreadsheet essentially just has main expenses on it and it's a blank sheet . No numbers on it yet , just columns and the . There's a . There's a column that has three Categories and I thought this was

really really cool , so cool that I wanted to bring it to the NLU listeners . All right , so she has all the main things like rent slash , mortgage , you know , utilities , internet all the main ones and there's a column that has the three categories to survive , to live and to thrive , and I thought that that was a really , really cool way to think about it .

And so everyone out there watching or listening to this , I want you thinking about your life , I want you thinking about your expenses , I want you thinking about where your money is going and I want you to put those expenses that you're thinking of in one of these three categories .

Now , obviously , you're not in front of a spreadsheet right now , necessarily , but you can do this exercise in your journal at home . Whatever you want to do , I actually have it in my journal my dreamliner . I was doing this earlier today . So the first bucket is to survive . These are the things that you absolutely need .

So food , shelter , clothing , things like that . Then the next category is to live . Now , to live would be I Don't know you could throw probably Netflix on that . You could probably throw Going out to eat on that . To live , you could probably throw maybe your car payment on that if it's a nicer car .

You know you don't necessarily need a luxury car to live , but you know that that goes there . And then the third bucket and I think the most important bucket and the most neglected bucket is to thrive , and To thrive is an investment in the future . So to thrive , you could put an online course on there . To thrive , you could put group coaching on there .

To thrive , you could put books in that . To thrive , you could put Going back to school . To thrive , you could put what's another good example of to thrive ? In this case the relationship talks coaching that these two people are investing in . So this is what I wrote in my journal this morning it needs to be 33% in each .

If you're too heavy on survive , no fulfillment or investment in the long term will happen . If you're too heavy on thrive , you're overextended and at risk . So if you're too heavy at Thrive and you're just buying a bunch of courses but you can't pay for food , you're in trouble . But if you're too heavy on just survive , you're basically only surviving and

you're not building a bigger , better , brighter future . And so I really like the framework Emilia came up with of to survive , to live and to thrive , and when you break down your expenses and you put them in those categories , I think it can really help you figure out if you have good balance .

Again , balance is probably the wrong word , but I'll call it allocation proper allocation of your investments , because someone who's only ever investing in the future at the expense of the now is overextended .

Maybe they're taking too many courses , buying too many books , doing too many things at the expense of their basic needs , and if the economy were to crash or something bad were to happen , maybe they don't have enough cash on hand to survive or to live .

But someone who's only ever surviving , who never , ever takes that trip or never , ever buys that course or never , ever tries that coaching , that's also not thriving , and so you can't be on . You know , at NLU we're very focused on drive to five .

Drive to five means you have expenses in the survive bucket , you have expenses in the live bucket and you have expenses in the thrive bucket , and you're harmonizing all three and you're in proper proportion , whereas if you're at one of the extremes overly abundant or overly scarce , overly surviving or overly thriving you're probably in trouble .

I know there's times where I would buy like a $9 book or maybe a $20 book , but that was . I wasn't going to go much higher than that in terms of where I was going to try to thrive , because I was struggling financially and I was more worried about okay

, these are the bills that have to get paid . With what I have left over , which back then was less than zero , there was not enough money to cover those bills . Never mind anything else , I wouldn't pour into the thrive bucket as much .

But as that started to pivot and there was a little bit of money left over , that's when it was okay , let's do this , let's do this , let's do this . I remember when we got the podcast studio . We had a podcast studio during COVID , but that was one of those things where that was tight for us at the time .

It was like $550 a month and we said I think it'll be worth it for the future , but in the short run it's just going to cost us money , but we're at a time where I feel like we're safe enough to be able to do that and not be overly scarce .

The live bucket is investing in the now and the survive bucket is basically just making sure you're staying afloat . And a good example of this would be if Kevin and I suddenly hired 10 random new people and we overextended and that was a bunch of money that we couldn't afford and we were trying to build the future on that .

That would be very dangerous , because if we lost a couple of clients we might be in trouble . That kind of thing it's overly scarce . Whereas if we never invest in team and we do everything ourselves just to survive , we're never going to build the bigger , better , brighter future and NLU is not going to grow .

And so the two ways businesses fail but also the two ways humans fail is they either grow too fast or too slow .

You're either not investing in yourself at all no books , no courses , no coaching , no therapy , you know , and you're just surviving and not really thriving or you're overly focused on buying all that stuff and spending too much money at the expense of your own survival . And again , you know it ebbs and flows and it depends on your core values .

It depends on what you what you value in terms of variety and fun , unique experiences may maybe survive . For you is a trip once a quarter , whereas for me that's not survived . Survive for me is I'm not not renting a movie , that kind of thing , and so it depends on each person .

But at the end of the day , I think it's a really cool If you were to do this analysis , look at what you're spending money on and realize , holy crap , my thrive bucket is completely empty . Maybe

you start small , maybe you start group coaching or get a new book or whatever it is . If you realize that your thrive bucket is really full , maybe you're overextended and maybe you're in danger if you were to lose your job or whatever .

I would say , well , I have a nice car , have a nice apartment , I have a lot of money in the bank , like I'm great , I am thriving right now , for sure . So even that label , I think is , is super helpful . I was , I Was living and I was living pretty well , but I thought that was to thrive how would you categorize it now , because ?

So even that , even redefining what that means to you , yeah what does thrive mean to you ? because I think for a lot of us we think at least I'll speak for myself I'm Doing really well now . That's what I used to think of when I would think of thriving . Thriving is to succeed , quote , unquote .

But to your point , if you're looking at it , at it in a vacuum , and it's right now , that doesn't necessarily

mean you're gonna be thriving two , three , four , five years from today . But I again , I remember when you and I had a conversation very early on and I said I don't know , man , I don't really get it like , why should I read ? This was serious conversation and maybe you've dealt with the same thing whether you're watching or listening .

I just couldn't fathom how a book was gonna help . I just it didn't make . It didn't make any sense to me , I could not grasp it . So I was not really set up to have long-term thriving success back then , like I am today .

They leased cars , they had new cars , that kind of thing and I was broke . I drove like a I don't know $2,800 cars , something like that . And I remember I used to think back then well , my education is really expensive . Fortunately , I got scholarships and financial aid and and my mom helped a bit .

But I was going into debt and I was paying a lot of money to go to WPI and but I remember thinking like one day this is all gonna pay back . And then some right , it's just like someone you know going to medical school , right , I mean , it's a ton of money up front , it's a ton of time and effort up front , there's very little return .

But later on they end up very Successful and so thrive is a lot of times actually Deceiving . Someone who's thriving might look like they're not thriving , and and I think that that's you know .

If you saw me in college junior year when I was painting houses in Maine I'm actually writing a blog about this right now and you would have said you would not have thought I was thriving . But three years after that I was making six figures and and it's a drastic increase .

When you spend for five years in college , I stayed for my masters and You're basically just trying to survive through college

and You're investing in your own education , you're investing in the degree , you're investing in your future . You're investing in your career . You're investing in your resume , you're going to career Career events and you're interviewing .

I remember I interviewed so many different places and you know it's interesting because all of that is working toward thriving , not necessarily living , and I lived in college too . You know , I found ways to have a good time , for sure , but at the end of the day , thriving can be deceiving . So just remember that .

And a Lot of people think of going to college as an investment in their future , but people don't necessarily think that way of buying a book . I I spent $59.99 this weekend on Audible because now they let you do five credits at a time . I think , yeah , five credits at a time , and I think it's more expensive . On the iPhone , I think Apple takes a cut .

I'm not sure . I probably should just go to my laptop because I probably would save four bucks or whatever . But the point is is I just had this book that Emilia recommended and I'm . I just was like , okay , let's do it . I trust it . I trust that that investment in my brain is gonna pay off .

But remember , the Thrive bucket sometimes takes a long time , a long time , to pay off and and there is no immediate return . If anything , it's actually an immediate hit .

If we're thinking about it on like a I'm not going to talk about the Libra Scale because I can never explain it but if you're thinking about it on a spectrum , survival is super short term , thriving is super long term , yep , and you need both .

If there's holes in the ship , man , you got to plug the holes .

If you don't have any money and you're bootstrapping , obviously I'm not saying to go buy a $12,000 course . I don't think that's a good idea . What I do think is a good idea is be strategic .

Like if you're surviving and you're struggling paycheck to paycheck , but you can afford maybe a $20 book , start there , you know , and just make sure that you don't have any of the buckets completely

empty . Because if you're only surviving and you're not living at all , you're also going to be deeply unfulfilled and that's not sustainable either . And if you're really , really , really .

But there's also the other side of that , where circumstance really does happen and sometimes you lose your job or there's a death in the family , or your car breaks down and crap hits the fan and you're in a very , very scarce place . Youtube is free . There's a lot of free things out there . If you want to thrive on a budget .

There's a lot of real , I mean , there's podcasts a million podcasts now . There's more than that but a lot of these podcasts have really good information . You can probably find books at used bookstores for super cheap , maybe a couple bucks . I have Tara and I went to a used bookstore . I got like five books for 15 bucks or something .

But YouTube there's so much on YouTube . Alan and I were having a discussion maybe last year and I said I want to learn more about math because at the time I was doing the CFO stuff and I was taking watching courses from MIT on YouTube , totally free , and I was thinking to myself I can't believe this is free . This is wild to me .

Did I have any idea what they were talking about ? No , not at all , but it was cool that I had the opportunity , you started at the yeah . I started at the top of the mountain . Yeah , I started at the wrong place .

But my only point with that is no matter how stuck you might feel , no matter how much you're just trying to get through , there are some options out there . To Alan's point some people would say I don't care if you're broke , spend your last $12,000 on a course . No , I don't think so .

good advice .

That's all . It's just that fine line , that very fine line . That would be my long overly drawn out next level nugget .

There's a bunch of free stuff on it . Yeah , so there's a bunch of free stuff for those of you who are struggling . Now . Tiny caveat I do think that , typically speaking , the free materials are not quite as good as the monetized ones , but that doesn't mean it's not a great place to start . Nlu included , right . This podcast is free and that's on purpose .

That doesn't mean it's as valuable as group coaching . Group coaching is more custom . We can talk to you directly , we can get to know you directly , we can have you do homework , we can have a guidebook . It's much more interactive and it needs to be that way . But I started with all free content .

I remember back after my car accident , 26 , nine years ago , I went all in on YouTube . I mean motivational videos . I still have many of them . I did , I started there . So it's a great place to start .

And then the more and more you grow from that content , the more and more successful you'll become , then the less and less broke you'll be and the more and more you can invest in your Thrive bucket .

And so maybe you start right now with 5% in Thrive and 45% in Live and 50% in Survive and then , little by little , year by year , you can put more in Thrive , more in Thrive , more in Thrive , more in Thrive , and then start thriving , thriving , thriving , and then the percentages stay the same .

Eventually it's 33 , 33 , 33 , 33 , but the numbers get much bigger . And I know I promised the last thing I say , but I always say things like this I don't know if it lands or not , but a company like Google has a department called Research and Development and they take 20% of their revenue and they reinvest it in research and development .

Research and development is just essentially how do you innovate better and better products ? How do you invest in the best scientists and the best data and the best tools ? My point is if Google's gonna invest in themselves in order to grow , why are we any different ? And so hopefully that lands in a new way for people .

But all businesses have to reinvest in order to build a bigger , better , brighter future . I think the same is true for all human beings . You have to do that with

your home . You renovate your kitchen , you renovate your bathroom , you do the downstairs , you landscape so that when you resell the house it's higher value . And the same goes for you in the economy , and it's the same concept . So hopefully you have enough self-worth to really take that 5% and put it back into your own personal development .

It is a practice for sure .

Next Salvation If you are looking for something that's free , that is valuable and a great opportunity to meet other amazing people like yourself who are into growth , into having conversations like this . Sometimes conversations around money can be uncomfortable .

Even as two podcast hosts , it can be weird to talk about money at times Just because you don't know where people are and how people are gonna respond to the words you say . But we have a private Facebook group called Next Salvation and it is all about this , all about how to get to the next level , the unique level of success in your life .

Link will be in the show notes , as always . We'd love to have you there .

Three words you need to remember if you want a next level relationship . I did not practice these three words to the extent that I wish that I had in the past , and these three words have become the foundation of the way I handle my relationship with Emilia and they have been absolutely critical . I hope that you join us . You can keep your camera on .

You can mute your mic . You can participate as little or as much as you'd like . The registration link is in the show notes . It is the Love Month . Valentine's Day is coming up and we wanna make sure you are prepared to have the best Love Month possible Tomorrow for episode number 1,598 , almost there , I hit 1600 this week .

We don't know yet , but we'll know more , probably tomorrow . So tune in to find out . As always , we love you , we appreciate you , grateful for each and every one of you and NLU . We don't have fans , we have family . We'll talk to you all tomorrow .