S5E10: Interest Rates | Ellicottville Mimosa | Getting Real About Budgeting

Disclaimer: The information in this video does not constitute Financial Advice. Consult with a Financial Advisor before making any decisions regarding your finances.

In this episode of Cash Flow, Pam and Francis combine beer tasting with real talk on budgeting. They review a fruity, mimosa-inspired beer while sharing practical tips for managing finances. Francis opens up about how budgeting changed his life, and Pam offers advice on creating a balanced budget that works for you. Tune in for helpful money insights and a fun beer review!

📰 On this week's What's News:
https://apnews.com/article/federal-reserve-interest-rates-loans-consumers-borrowing-6127436dd3e6d8af48825aca6d3a7715

Today's Brew🍺: Mimosa, Ellicottville Brewing Co. 

Check out Ellicottville Brewing Co: https://www.ellicottvillebrewing.com/ 

🍻 The P.B.K.P.I (Pam's Beer KPI) Scale, for reference ⚖️: 
1. I'm NOT touching it
2. It's sippable...
3. I'd drink it again if you gave it to me
4. I'll order it from the menu
5. I'll scour the ends of the earth to find it

About the Brewery: 
Ellicottville Brewing was established in 1995 by our beer-loving founder, Mr. Peter Kreinheder, after a ski trip to Vail, CO. Inspiration had struck: an authentic craft brewery would be the perfect match for the village of Ellicottville, located in the heart of New York ski country, also known as “The Aspen of the East”. This pairing of Old World brewing and winter-worshipping ski culture proved to be a success ahead of the trend, with EBC helping to lead a then-fledgling NYS craft beer market.

Transcript

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And number two, if it is, you can still deal with it. But the intensity of that difference between what your brain said was the situation. What it makes it out to be. And what the actual situation was paralyzes so many people. Yeah. And I really recommend that you take the time to do what we did together, which, honestly, just to be fair, and we're talking about budgets, is just sit down and write down every expense you have and write down what your actual debt is. Once you get those things on paper, the doors open. It becomes a thing we manage at that point. Yeah. And that was so extreme for you. It was like, you are my poster child for that. That story that 100% changed my life from that point. You know, it wasn't just a year of stress. It was five, six years ago. Stress just in my head, like, thinking about all this stuff. Stuff. And when we sat down and we realized that it was. This weight had lifted off my shoulders, honestly, I felt like I could cry. Like I, you know, I felt like. Hey, welcome back to the Cash Flow podcast with me, Ann Pryor. Glad to have you here, where we talk about everything money related in your business. So without further ado, let's hop right in. Welcome to the Cash Flow podcast. We're thrilled to be back this week with some really exciting news from the Fed where they have cut the interest rate. Let's find out what that means for you in our news segment. Then we're hopping into a fun brew we've had from this brewery before. I have not had a sip yet. Ellicottville. I said it right. Ellicottville brewery. We have a new fun one to try in our brews segment. And then finally, in our scale or fail segment, one of my very favorite topics. We're going to talk to Frances about budgeting and forecasting. Now, don't run away. It's not as bad as it sounds. The budget word actually is a really positive thing for you and for your business, and we're going to show you why today. So stay tuned, and we're going to hop right into the news. Okay, so, recently, very recently, the Fed has finally done what they call cut the interest rate. Now, there's a long, involved economic story there, which I'm not going to go into, but basically, what does this mean for us normal people, both as consumers and as business owners? And there are a couple of implications, although my general warning to you is, don't overreact. Right? If you see on the news that the Fed's cut the interest rate, it's not necessarily time to go jump in and say, hey, let's refinance the mortgage, or let's go borrow some money because the interest rate is down, or let's move all our money out of savings because all of a sudden we're not going to make good interest on savings anymore. There is going to be an implication in the long run. But what I would say to you is that over the last four years, the Fed has continually been raising the interest rate, which you've probably noticed. If you've gone to buy a cardinal, you've noticed that the interest rate to do that can be a little bit higher. If you've gone to buy a home, you've noticed that the interest rates have crept back up. If most notably, you've had a savings account of any kind, then you'll notice that all of a sudden those savings accounts are starting to make interest. Before the pandemic, you put money in a savings account. You'd be lucky if you saw like 0.5% interest. And recently these banks have been competing, offering like 4.5 or 5% interest for money you put in savings. So what does this all mean if you break it down? Let's talk about it from the consumer side or the business side, if you're needing to buy stuff. So first of all, what it means is if you need to buy stuff and borrow that, you'll just pay a little bit less for it now. So where you may have had an interest rate on a car that might have been, I don't know, they still are pretty low on a cars, three or 4% now, you might get one for two or 3%. If you have noticed that your credit card, if you're getting new credit cards, that the interest rates have kept creeping up and up and up, now you'll see the opposite start to happen. They'll creep down a little bit. If you do want to remortgage, if you happen to buy your house at a time, or a boat or a car, anything really, with interest at a time. While these interest rates have been high the last couple of years, I don't know that. Again, not financial advice, not investment advice, but I don't know that I jump right now, because when the fed does these things like cut the interest rate for the first time in four years, it takes a little bit of time for it to flush all the way through the banking system. And truth be told, the bets are that they're probably not done cutting the interest rates. So in essence, what they did is raised interest rates to try and control inflation. Now that inflation is somewhat under control, they're starting to reduce the interest rates. And like I said, there's a whole economic background for it, which is kind of interesting, but not for the cash flow podcast. And you just need to know, like, don't jump too quickly. Wait and see what happens. Inquire a little bit. Keep an eye on your credit card. It might be a time to actually call your credit card bank and say, hey, I've got this credit card with you. I'm thinking of moving to a different credit card company. Can you bring my interest rate down so, you know, wait a week or two and give that a try? That is always a good tip, by the way, massive hack that we should note is in this episode, Francis, because if you've had a credit card, personal or business, for any length of time, you can always call them and say, hey, I'm actually thinking of leaving. I don't know, let's just say Capital one and moving to American Express, or moving to discover or Barclay or some other bank and say, hey, unless you can maybe bring my interest rate down a little bit, if you're rolling a balance on the credit card, that's always a good thing to try and do. But now in this next month or so, that'll be a really good idea. What does it mean for you on the savings side? So one of the things we noticed is that over the last four years, some of my clients who've been putting more and more money in savings for whatever reason, they're building cash to buy something or do something, is the interest rates have been creeping up on these savings accounts. All of a sudden, if you buy a certificate of deposit or you get a treasury bond, or you get a savings account, those interest rates have been creeping up. And I don't know if you remember pre pandemic, but truly it was like zero interest rate in savings. There was no difference in putting your money in a checking account or a savings account. Now, to discover Capital one, any number of these bigger banks, Barclays relay all of them, they're offering some pretty good percentages for saving. So I would just say, keep an eye on those accounts over the next quarter or two and see if yours is coming down, if you're getting less and less of an interest rate on your money, particularly if you have a lot in savings. And if you do, just make sure you check around to some competitor banks and see what they're offering to. And I will tell you, I get no affiliate feed from these guys. Although I should ask them to be a sponsor. Nerdwallet. Nerdwallet really keeps an eye on this stuff for people. Two things it keeps an eye on. One, what's the best credit card for your particular situation? And it includes an assessment of the interest rates. But the second is also where is the best savings account to put your money in? So those are the couple things I want you to keep an eye on. This is a big deal, this interest cut, because it's been a while since we've done it and might see inflation has stabilized a little bit. You're not seeing those egg prices go up anymore. That's why they've been able to now start to cut interest rates a little bit to get people to start buying more stuff. So that's what we're in for. And that's the wrap on the news segment this week. And stick around, though, for scale or fail, because we're going to address in that, after our beer segment, mind you, we're going to address in that one of the important things that relates to those interest rates a little bit. Oh, I'm excited about the brews section today. I think you all know, and you certainly know, that we get the delivery of the month. Beer of the month. Yeah. Another person we should get as a sponsor. Yes, but we don't currently have them as sponsor. I just love them. And they come with this really cool write up of both the breweries and the beers they provide. It's usually four beers, three each. That's awesome. And we just happened to have a box arrive today and one of our breweries that we've already talked about. I'll have to look it up to see what our PBKPI was for that one. Yeah, that's our rating in case you're new to the show here. But it's. I never could say this the last time we had this, but it's Ellicottville. You sure it's not Elliot Cotville? Smart ass. Cairo. Elliot Cotteville, Ellicottville Brewing Company in Ellicottville, New York. Awesome. Which when tells us is right near Buffalo. Yeah, right near Buffalo. Buffalo. And it's known as the aspen of the east. And just as a reminder, that's why these guys started their brewery there 30 years ago. It's three guys. And they started it there because they had been to Colorado where brewing was just starting to take hold. And since this was aspen of the east, they thought, hey, we love beer. We're going to bring that brewery, bring. It all the way over here, back here. And they did it. The beer today, I'm very excited about. And I don't normally read, like, all of the key things about the beer, but this one, like, on paper, should be perfect. Everything. It should be perfect, which makes me think I'm going to hate it. But it has everything on it. So it's a New England style IPA, which we know I'm a sucker for. It pours a pale golden color and it's got a fleeting head, so it's not a really heady, creamy kind of beer. And on the nose, so when we smell it, it says a lot of grapefruit and orange, which we love. And then it starts to talk about the bitterness and says it's really firm bitterness. So I love that. You do like your bitter beers. I do like my IPA hop pop there, for sure. And then it says, slightly dry and ready for the next sip, is how it leaves your mouth at the end. So it's a 7.0 alcohol by volume. Gotcha. And the bittering units, the Ibus that we've talked about are 75, which is a lot higher than some of the ones we've been tasting recently. I was gonna say that sounds like a bitter beer. Yeah. And just a quick reminder on the Ibus, that's sort of a bitterness scale for the hops. It doesn't necessarily mean the beer is going to be that bitter, but it does talk about the hops that are used, and two of these hops we've had before. Two of them I don't think I've tried or known I was trying before. The two we've had are sabro and cascade, but then Haller tower, which I'm going to need to find more about. We have a haller tower, Magnum. And a haller tower blanc. Is that German? The haller tower is spelled like German. Tauer. The Blanc, I think, is a French blanc, is a french word, like sauvignon blanc and things like that. But the Heller tower, apparently, the Heller tower blanc is one. Bringing the grapefruit feel to it. Gotcha. So I am very excited to try this and I think we ought to pop it. And you want me to try it again, don't you? You've left it there for me to try. I have it ominously sitting there. You did it so well last time. I did it. I want to see if you can do it again. Give it a shot here. So, I remember I grew rabbit like this. Lower. Yeah. No, you wanted the beer to be a little bit lower. You want the lid to be right on the inside. Like here. Right there. And I put this finger out for lip. The finger. This finger wraps around inside? Yep. And then the spoon comes on top of that finger. Right? Yeah. And we just flip it and the other way. No, you want to use the other side of the spoon. No, the other side of the spoon. Oh, that's the spoons. Oh, the spoons. Yeah. I have such a good memory. And then we use this finger for leverage. Yeah, you're popping. There you go. Might as you do it twice. Not as clean as when you do it, but it works. You're getting better at it, though. And this is gonna be a cool potty trick to whip. It's an awesome potty trick. Potty trick. Potty trick. Are you doing potty beers, Pam? I used to be able to speak. Now we have Cairo, Elliot Cotteville, and potty trick. So, yes, potty trick. I will let you in Brooklyn. Let's see what we got here. I'm going to watch the four just because I'm curious about the color. Oh, yeah, I do like that color. That is nice. It did say to drink it in a tulip or a glass, like this wine glass. So we're in the right kind of glasses. Oh, I do like that. That's a good percentage ahead there. This one's for you. Thank you. Because, you know, I'll drink the whole thing. Yeah. Cheers. Cheers. All right, let's see what we got here. All right. It smells really citrusy. Oh, you definitely get a lot more citrus than I was thinking was going to come. And this is mimosa, it's called, right? Mimosa? Yeah, I definitely get the orange. What is a mimosa drink? What's champagne with a lot of people? It's like champagne with a splash of orange juice. Orange juice. That's it. That's what it. Yep. And that does. That is what it smells like. It smells like really, really strong orange juice. Like a mimosa. All right, let's see here. All right, I'm ready. Grapefruit and orange. Like, right off the bat. Yeah, it's like punch. Like a mimosa? Yeah, it really punches you in the face. That's like you're drinking a mimosa like that. Tastes like that sip of champagne. It does, oddly, does not taste that initially. Doesn't taste that much like beer. It's pretty dry. Like, you know what I mean? That was something that they had highlighted in the, in the reef. Right. I really like this. It's a bright. It's very aerated and bright. It does leave that dry taste, which I love after an IPA. That sort of hoppy taste. It's not as bitter as I expected. It's not bit. I wouldn't call it bitter in any way. I wouldn't either. And I like it. It, like, I could close my eyes and you could probably put this in a champagne glass and do, like, a blind Coke Pepsi test. And if I didn't, like, I'm sure if I had them next to each other, I'd be able to tell which was which. But I could take a sip of this and be fooled that it was actually a mimosa. Yeah. Honestly, not a beer. And it's interesting, too, because, like, on the nose, the scent, like, I don't. Smell beer at all on the nose. We have nailed it, haven't we? All I get is, like, orange juice. Yeah. If I had been blindfolded and you put this in front of me until I was. Want to make Gwen taste this one? I mean, when. I don't know is when drink. Well, they'll sample stuff sometimes. Okay. I'm very curious regardless, because I don't like. Do you like mimosas? Yeah. Take a sip. That's why I'm thinking you ought to sip it, because I thought you liked mimosas. It's very orangey. Right? Like, it's orangey, but it's also, like, almost like a passion fruit. Like, it's. Yes. Very mango. Yeah. Oh, yeah. I didn't even think of mango. It's kind of pineapple, too. It has like, a pineapple. I don't get beer. Well, I do because I like beer, but. Yeah, that's weird. It's like how it smells, but I don't hate it. Yeah, I'm like this. This almost tastes like a mimosa. Nicely done there, Ellicottville. I like that. This is a good brew. I would get this again. Now what? I don't know. I know it's available in New York, all of western New York. I don't know if we could find it in stores here. If I just got it on my beer of the month club, but great choice. What do you give it? Pbkpi. Just as a reminder, this is the Pam's brew KPI, one to five. One is you couldn't pay me to drink it, and five is I'm gonna hunt it down and kill it to drink it because I love it. I'm torn because I feel like the last one I gave it, last one I gave was a three. Yeah. And this one I like slightly more. Okay. But, like, you can't have half points. I know. We're not going. What was the four again? Four was. All right, let me try to remember. Five is I'll hunt it down. Four is if I see it on the menu, I'm really going to go. If I'm going to find a restaurant, if I'm in a restaurant with it on the menu, it's going to be the one I order. Three is. It's good. I'm going to order it. It's a three. It's a three for me. Yeah. I would tell Kai to order it. I think Kaia would love that. I think it's interesting. It says to pair it with breakfast. I think it would be really good with brunch. This was. This is a brunch. Beer. I don't usually think about drinking beer earlier in the day. I know. We do. It is

interesting. All we do is drink beer at. 10: 17:01

00 a.m. all we do is drink beer early in the day. But if I were gonna have a brunch, I would order this. But if I were, like, at dinner or out at night, it's a little too fruity for me. It would be a savory brunch for me, though. I wouldn't want this like it said on there. Cheese or chocolate? No, no, no. It said french toast. No, cheese or chocolate was just other of the month clubs they had. Okay. It said french toast, eggs Benedict, croissants with cheese and ham. That kind. I could see it with, like, you know, good omelette, something like that. Me too. Hash browns. Now I'm hungry. It's just interesting that it doesn't really hit me, like, beer and wen kind of said the same thing. They didn't have that. Oh, it's beer reaction. Exactly. I have to go. Probably a three for me. This is a three doesn't mean take it or leave it. Three means if I saw it on the menu, I'd be like, oh, I like this. Let me order it. Yeah. So I'm going with a three. You went with the three? I did go with the three, and I am gonna have one more set. Good for you. There we go. We're in. I like it. It's so. It's really refreshing. It's light. Yes. It's like a light, refreshing summer drink. I'm with you there. That is definitely a summer. Yeah. It's good that they sent this out at the last, like, kind of tail end of the summer, you know what I mean? Yeah, that's a good point. It probably is. Good way to end it. I like that. Very, very nice. All right. So there it is, folks. Mimosa from Ellicottville. Give it a try if you are in western New York and I'm going to take a look for it in stores here and see if we can actually find it. So you might hunt it down? I might. I might hunt it down. So what does that mean? It's not a five because I'm not like, I've got to go out right now and hunt it down. It's not my Aristais. How many do you get in your of each beer when you get them? Three. Each of four beers. Three. Each of four beers. Yeah. I mean, you might like it even more after the second run through, you know what I mean? I might. Although I will tell you now that we've been longer since I've had a sip, it's not as. Yeah, it's like, yeah, okay. It's, I feel like it's a good intro to IPA beer. There you go. If you don't want to get too bitter right off the bat. Yeah, I like that. That's true. That is true. All right. Good choice. Awesome. Well, that was your choice. Oh, that was my choice. But that just doesn't happen to land on my, on your porch. All right. Well, that's it for our brew segment, folks. Stay tuned because we're going to hop into what's often thought of as a bad word, but it's really not. I want to change your thinking about it. Budget and forecasting in your business as we talk about it for forward press. Media, our partnership, I'm excited, I think. Well, so just jumping off the bat budget to me has always been a stressful word. I feel like that's a stressful word for a lot of people. It is. And there's a bunch of reasons why budgeting is a stressful word, you know, one, it's because not a lot of people know how to do it the right way. Two, it feels like homework and it's, you know, something that you have to keep up with and it's something that you have to manage and monitor and that's just, it adds on to more work. But if you do it the right way, in the way that kind of, we've done it in the way that you've taught me how to do it, it doesn't feel like such a mountain to climb. And then third, it's just you know, nobody really wants to think that much about their finances that in depth when you're breaking it down that granularly than the way that we have. And I feel like doing the budget more routinely has helped me overall with my relationship with money and finances, like in the past couple of months, over the past year and a half that we've been working with you. So I just kind of want to start by saying, you know, that budget, it does have such a bad reputation, but I feel like it's a misconception. And if you teach it the right way, and if you can learn it in the right way, it doesn't feel as bad. I think that's a really, really good point. And the word itself has a negative connotation because we use it as sort of a restrictive term. Like, if you're going to budget your time, you're going to restrict how much you have. You're gonna budget your money, you're gonna restrict how much you can spend. Yeah. And I almost want a new word for it. And there's somebody who came up with a really, really good word for it. I cannot remember what it was, but I remember thinking, wow, that's the way to look at it. And it's more of an allowance. It's like the word allow has a lot more, like, to me, positive feeling than budget. Budget feels restrictive. Allow feels like it opens things up a little bit. So I think a big part of why people are resistant to budgets is it goes along with all that other money mindset stuff. It's scarcity, and I want the budget or the forecast, which is why I like the word forecast better, to be more expansive. And I think it unnecessarily adds to the stress about money management, because people think I'm going to hate the budget. This is going to tell me I can't spend money and I hate money anyway, or I think money is scarce anyway. So it's just going to reinforce that for me. Yeah. Can I jump in really quickly with something? Because one thing that you said that stands out to me. So from the way that you describe it, is forecasting and budgeting one and the same, or does budgeting contribute to forecasting? I kind of want to make sure that we go through that part as well. This is really a matter of feel. It's like it's semantics. Right. So some people use bills and invoices are another term like this. Are they the same thing or are they not the same thing? Well, if you get down to technical accounting definitions, sure. They're different. But how do people use them? And I think in most of the world of entrepreneurs, people use budgets and forecasts interchangeably. I tend to actually mold my definition of those words to how an individual entrepreneur thinks about it. Gotcha. Right. So, as you know, we're very bespoke in our services. So every entrepreneur, our whole job is to translate accounting and finance into what works for them, what makes sense for them, use the terminology and the, the cadence and the presentation that most suits them, because otherwise, it's of no use. So for me, the difference is, comes from my corporate upbringing. For me, budgets were what we put in place for the year. That said, restrictively, in your department at Dupont, you can spend this much money on these things. Gotcha. And the forecast was every quarter we would come around and say, okay, we have our budget. We know what we've done for the first quarter. We still have our budget for the rest of the year, but what do we really think is going to happen? And the forecast was the thing that we really thought was going to happen, and we never really dealt with it. We just send it up to the powers that be to say, you guys figure this out. Okay? So that's one way to look at it. Another way to look at it is a forecast is really at any point in time, here is what I think is going to happen, and it helps the entrepreneur understand how I need to think about taxes on this much income for the year, or that's when I can hire somebody is out there where I forecast we're going to have this much revenue. And a budget is something that you are, again, restricting your spending to. Oh, this is what I can spend this month. Is it right to think that budget is real time and forecast is long term? That is sort of how it plays out a little bit. Okay. Because the budget would still stay in place, maybe even for the same period as a forecast. But one is what you're trying to constrain yourself to, and the other is kind of, here's what I think is actually going to happen. Gotcha. So even though those are the official definitions, the way I like to think about it is whatever the entrepreneur thinks. So what I'm interested in hearing from you is, what do you think? What is a budget and what is a forecast, by your definition? So, like, over the past couple of months, I mean, you know, personally, we've been working on our finances with you, and then in the business, we've been kind of building out how we plan on using things. And I think that the budget, for me, the way that I've been looking at it, is more of guideline. Right. It's, this is what we can spend right now. This is what we can afford right now. This is what we, this is where we can allot our money and then forecast. The way that I'm looking at that is long term, the way that we build out our spreadsheet for our budgeting is when I'm looking into next month, the month after that, the month after that, and next year, and looking at how much we're going to pay down in certain areas of debt, how much we're going to save in this area, and then for the business, it's kind of the same, you know, with the budget, it's how much we can afford to spend in certain areas right now in order to better the business. And then the forecast is, you know, long term, like, do we have this for next month? What do we have in the future? How far out can we plan to hire different things along those lines? All right, then I'm going to do with you here exactly what I would do with any client. Yeah. And say we're going with that definition. Okay. So in terms of your personal budget process, you know, kind of what we've done, and just as a starting point for people, if you're ready to think about budgeting, call it whatever you want, but stop, like, thinking of it as restrictive because it's the opposite of restricted. So I want to make one major point before we start. The rest of this conversation is the fact that we put a budget in place for you and that you call it a budget is kind of irrelevant. The day we did that was the day that year's worth, or at least a year worth of stress about not knowing what the hell was behind the door just disappeared. Yeah. So to me, a real budget that you put in place becomes the thing that absolutely pops the cloud, and off it goes. It's not there anymore. So just to kind of rehash, if you don't mind me saying this, you're the editor, so you can cut it out if you don't want me to. But coming into our first meeting about this, you were like, everything's horrible. We don't have enough money for anything. Yeah, I'm going to be arrested and go to jail for all sorts of things because I can't pay my bill, blah, blah, blah. Yeah. The minute we actually looked at what was there, and I remember you were kind of like, what? Yeah, it was. Remember I talk about a tiger or a kitty cat behind the door. Was a kitty cat behind the door. It was a hamster behind the door. Behind the door. And the. But what the budget did for us was literally make that whole horrible feeling go away. Yeah. And that feeling. Tell me a little bit about the change in your total outlook on life, on business, on marriage, on everything between the day before we had that conversation and the day after we had it. Yeah, I think. Well, one, I would love to dive a little bit more into that. Okay, great. Just because I think it's really helpful. Because I think it's a very common issue. I know so many people that have these, you know, money things that it's built up, and so many reasons why they're afraid to talk about them and are embarrassed to talk about them, or they're afraid to have these conversations with other people because they're afraid nobody else wants this. I'm the only one who. I'm the only person that's ever been in this situation. But, you know, going back to. It was around a year ago, Aspen. That long hadn't. Yeah, it was a year ago. Because it was. Right. It was scalable. Or was it podcast movement? It was podcast. It was podcast where you were so stressed. Yeah. And I was just really stressed. Um, and basically, you know, every. Every. As most young people do, they open credit cards, they let the debt get away from them. And you knew you were getting married soon, so you have dual responsibility now. Yeah. And, you know, in addition to that, you're feeling. This is just my personal issues, but I. In most relationships, you feel the man feels like he needs to provide in a certain way, and that's not how our relationship is in any way. Right. Me and my fiancee. Genetics make you go there. Yeah. We're very much a team. We very much look at everything as, you know, we're working together on this, but just inherently, you have this kind of driver in the back of your head, like, I need to do x, y, and z. I bear the weight of this. My job is these things. Yeah, exactly. And, you know, I came to you, and I was just basically crumbling under stress. We were ramping things up work wise. We were ramping things up in a lot of different areas, and I just wasn't feeling clear mentally because of the stress that I was feeling on my shoulders with my finances. So it was everywhere. And all your decisions, it was everywhere. I mean, you know, it was leading me just into this depressive whole of, you know, I don't. I don't feel like there's a future here. Yeah. There's no way out. The doors are closing, and the box is smaller and smaller and smaller. And I asked you for a little bit of time. We sat down, you and me, one on one, and ran through kind of what actually was going on. And like you said, we really dove into it and realized this. I kept waiting for the. I kept waiting for the thing you weren't telling me. I know this pile of debt that I've assumed was there was in my head. I built it up to be, you know, hundreds of thousands of dollars, and it was less than two grand of finance. That's a really important point. Our minds do that to us. Yeah. Like, you probably knew somewhere in your head it could only possibly be $2,000. No, no. In my head, it was, you know, in my head, it was like 30, 40, 50. And it was just from one thing. Your brain, that you couldn't access somehow knew what it actually was, probably. But you. Our minds really screw with us, and you have whatever history with money that you have, and it made you believe you were in an impossible situation. And it was such an extreme that I knew there had to be something else he wasn't telling me. And I was like, okay, well, he's not ready yet. We'll find out about that. We'll find. And it wasn't. It was everything. No, we went through all of like that. We pulled up all the reports, everything. And we found. We look at credit history. We looked at actual bills. This is a really important point, because when I say what's behind that door always feels like a tiger. It does. And, yeah, sometimes it might be a tiger. Every now and then, we open the door, and it is hundreds of debt. That's rare, number one. And number two, if it is, you can still deal with it. But the intensity of that difference between what your brain said was the situation to be and what the actual situation was paralyzes so many people. Yeah. And I really recommend that you take the time to do what we did together, which, honestly, just to be fair, and we're talking about budgets, is just sit down and write down every expense you have and write down what your actual debt is. Once you get those things on paper, the doors open, it becomes a thing we manage at that point. Yeah. And that was so extreme for you. It was like, you are my poster child for that. That story that 100% changed my life from that point. You know, it was. It wasn't just a year of stress. It was five, six years ago stress just in my head. Like, thinking about all this stuff. And when we sat down and we realized that it was, this weight had lifted off my shoulders, honestly, I felt like I could cry. Like I, you know, I felt like it was this. It was a different life that I could live in the future, you know, and that was, that was how drastic that change was for me. So going back to kind of what you said, it's just about putting it on paper and not allowing your brain to build it up and really looking at the blueprint that you have in front of you with what actually you're spending, what you're actually doing, breaking it down. I mean, I know that a lot of people have different processes. We broke it down into certain areas. Made send to you. Yeah, exactly. And there's not a right way or a wrong way to do it. Like, everybody lives different. Every utilities together. Some people group all their home costs together. Some people want to see, you know, groceries separate from coffee shops separate from. And that's the thing can be, however you think about it. And it also, one of the things that I think is really important is that you don't just put down the needs. No, I put down both the wants and the next level of wants. Yeah. And that's something I think is really important to do. Because if you just put down the needs, number one, you're going to be wrong. Right. Because you're going to miss something. And there's always going to be a surprise every month. But number two is you don't have a little bit of a more expansive thought about what a budget is, which is what we're trying to get at. And the other thing, too, it's what this does. It allows you to feel not as restricted, because what I love about it's the opposite. It's what I love about our budget is, you know, with Kai and I, Kai and I like to eat out. Kai and I like to enjoy certain. Things, and we focused on that. What are the things you do to enjoy life? So we built in, you know, our entertainment budget. We built in, you know, we pay for streaming services. We built in that we built up. While we were doing that and still not restricting ourselves but keeping ourselves into these guidelines, we were still able to build up savings, even though we didn't think that that was a possibility. Pay off debt when you were out doing something fun. Yeah. Were you before that? You were probably thinking, I'm projecting here, but you were probably thinking, oh, shit, I really don't have money to do this. Yeah, but I love Kaia. We're gonna do it. We're having fun. I love you. I love you. I love you. Yeah. But. And it was turning those things into not super fun for me either, you know? And now we look at those with a much different light. You know, this. This week on Sunday, we decided just out of nowhere. Or Monday, actually. We decided, I know where to buy tickets for the Eagles game, and we were like, we can bid it into the budget. Yeah. Oh, did you go to that game? We. We did go to that game. I'm sorry. It was a sad game. It was the easiest. What was fun during the game until the end, I think. No, it was not a fun game. Okay. It was not a fun game, Pam. It was a bad game to watch. For anybody that likes football or knows football, that was a bad game. How do you feel about that? I'm not feeling great right now. I shouldn't have taken you off. I think we started going down. It was better to watch at home because we got to see Jason Kelsey do this. I didn't even get to see him. We got to see him and his commercials. Yeah. I didn't even get to see him. Yeah. Also, just, by the way, I don't know if you saw the pictures. I did see the pictures, and we, Kaya got a really cool video because when we walked in for, like, the tailgate, he was doing the pre show. Yeah. So we got a cool view of that. But the game itself, the game itself, one suck. Also. If you're going to a football game, guys, don't be an asshole and get shit faced and throw up all over yourself in front of a bunch of people and then get. Leave all your puke all over the seats, because that's what the guy in front of us did. Literally. He's sitting there. Welcome to link. He's got. Yeah, he's got his. She's coughing into his shirt, and he stands up and all the thrill pours out all over his branches, all over the seat in front of him. And it was bad. It stunk. We had just got a cheesesteak friller. Halftime. I was sitting down, and we looked forward, and the guys that we were talking to sitting next to us were like, yeah, this guy just puked. And we realized it, and it started to smell. I mean, don't ruin the game for people. That's all I got to say. The Eagles did that on their own. They did. I've never seen. This is a real diversion, but I've never seen people so angry leaving the stadium. Oh, it was a bad. The cool thing about Philly fans is Eagles fans, Philadelphia Philly fans, is they're really passionate about their team. They love the people they love. But all you have to do to be loved is work hard. Yeah. And. And show your stuff. You don't necessarily have to. Well, you do. Well, you don't. But if you're working hard, even if you don't win, they're not going to be mad. Yeah. These people came out of that stadium pissed off. We were. Everybody was mad. I mean, kaya, she's an Eagles fan. She's not as big of an Eagles fan as me is as I am. And she was walking out of there like, you fucking suck. She was mad. She was really mad. We take it very seriously. And the guy that was in front of us was walking out, and he. Not the puke guy. Not the puke guy. They kicked him out at halftime. Okay. But they, Lincoln financial field people never came up to clean the puke up. So it was a whole half of the game that we were sitting behind the puke, just saying, not throwing too much shade. They may not have known. Did anybody tell them? I reported it twice. Somebody else reported it. We called up somebody. Okay. It was made. No. All right. But anyway, going back to. Back to budget. We're going on. Literally decided on that day, I'm gonna go buy Eagles tickets. Yeah, we went. We had a fun night, even though we had a semi fun night. There you go. And Kya and you enjoyed each other. Yeah. Oh, oh. I mean, I'm not going down there. The game just ruins the whole vibe, you know what I mean? Like, we had so much fun and then that the loss sucks it out of you, you know? But anyway, also, we. Every home opener that we should have. Gone for fourth down in the first quarter, that wouldn't. Just blew my mind. I think that they should have taken the points, that I'll just throw that out there and then also, I'm not as mad about the Saquon play. I think that that would have worked if he had caught. That's risk. That kind of risk we take. Yeah. I won the Super bowl, frankly. Yeah. So I'm good with that. I do think, though, that Jalen hurts made some pretty bad choices at the end there. All right. He holds the ball. We're going down a route. Yeah, we are going. You could go on about that forever. But the point is, the budget allowed you to be able to do that on the floor. Yeah. And that's kind of the point I want to make. Is the budget, even though it's a horrible word for it, really does bring freedom, as opposed to restriction. It opens doors. That's the main point I want you to make in the podcast notes here, that budget actually equals freedom. Nothing. Not restriction. Yeah, because without that, you know, we probably wouldn't have gone. But we looked at it. We were like, we can do it, you know? And that was the thing that switched off. And that's when we grabbed the tickets and doing things like that, and then still being able to know that we're building up savings. We're able to pay for this, we're able to pay for the wedding, and we're not gonna be in crushing debt for the wedding. We're able to buy a new car and not have all of that weight as well. Right. Doing all these things with the budget made all that happen. So, you know, and then thinking about doing all these things for the business as well, it's going to open so many doors for our business as we build this out together with. With our forecast, with how we decide on allotting different things for things in the future, prioritizing. And then it's also just cool, because we were able to start from the get go with this. And I know that a lot of entrepreneurs, a lot of people have to play catch up. And I do think that no matter what point you're at, even if you're at a point in your business where you don't feel like it's a possibility, just sit down and put it all on paper, and because it then you know exactly what you can do in your business. You know exactly how you can expand, how you can grow. The hole doesn't get deeper. Exactly. And you know, what you can. What you can do to solve the problems that you have in your business. You know, it's really, really true. And I think the the major points I would want to make is that it really is exactly that. We're talking about a personal budget, but it's exactly the same thing for a business budget. And we're just starting out, so we'll be able to talk about, and we will in a minute, how to deal with the business budget. But even if you've gone a long way in multiple years without a budget or a forecast, it can't hurt to put it down, because even in my business, where we've had revenue. And here's the problem with revenue. Revenue kind of hides all ills. I have this horrible tendency of buying stuff like software. You know, this because poor Francis has to clean up behind me. So does when, like, it's, oh, that looks cool. Let's try that. But then you don't tell us about it. I kind of forget because sometimes it's like on the weekend and. But once I sat down and put a budget on the business, I'm like, okay, that's a ridiculous amount of money to be spending on that. And, and we, and I fixed it. Right. If I hadn't, like, written it down and gone back and said, okay, let's do this, then you just keep doing it without even really being aware until it becomes a problem. Exactly. So that's kind of the first thing. It's ever too late to start a budget process because you can always kind of go, oh, and you'll get an eye opener. It's like, I didn't know I was spending that much. And you're like, I don't need to be spending that much. It's an eye opener. And it also is a stress reliever. In contrary to belief, you know, it's. Exactly the opposite of what you think it would do. The exact opposite of what you think it would do. It relieves so much stress because you're not building it up in your mind to be something that it isn't anymore. You're seeing the numbers on paper. You're not assuming. And I feel like that's the biggest stress driver in a lot of people is just assumption that are wrong. Yeah. And you're not assuming that. Oh, like, I screwed up and I screwed myself forever because of x, Y, and z in the business. I didn't do this from the get go. Why should I start now? Like, I feel like that's the mindset that we have to really try to shift in people, because it's never too late to do this for yourself, for your business, for your personal finances, for your business finances. It's never too late to do any of this stuff. And it really. It takes 2 hours. Well, this was my question. So two things I want to ask you about on this that I think are so important for people to hear from kind of somebody who's doing this for the first time. Yeah. One is how much time do you spend on the budget every month? Your personal budget. Okay, so I don't spend any time on the personal budget. You and Kaya together? Yes. I have an amazing fiance who takes the time weekly to go through, and I think that it probably takes her around a half an hour to 45 minutes in total to go through all of our weekly stuff. Perfect. She keeps all of our tracking and stuff on the sheet, and she makes sure that all that is up to date. And then we meet with you 1 hour monthly, and that's about it. And the 1 hour monthly isn't really to do the budget. No, 1 hour monthly is more like personal strategy call. Yeah. Hey, here are the five things we want to do next. When should we do them? And we look and we try, we talk. Well, which one's most important exactly? Like, for instance, the most recent call we had. We're getting married in November. Right. I was stressing big time about expenses, about, you know. Okay, well, we're paying for the wedding. We have some support from our family, thankfully, but paying for the wedding, and it's, you know, weddings, there's always something else. You always think you're done. Yeah. I was like, okay, we checked all these boxes. We're good. Oh, but we have to buy favors. Oh, we have to believe this. Oh, we have to do the flowers. Oh, the decorations. Oh, x, y, z. All this stuff that comes into the wedding, and it's just stuff that you don't think about. And it was just, you know, starting to stress me out. It was one of those things that I was just, like, assuming I wasn't. We weren't going to be able to afford it. Give me a sense. Is it like 10% more than you thought it was going to be? Is it twice as much as you thought it was? Honestly, it's less than we thought it was going to be. Kai and I sat down and, like, a day after we met with you. No, before you met with you, how much were you feeling it was going to be? I thought we were probably going to be like 15% higher than an actual numbers. And tell me what you discovered. After we actually looked at it then. Well, then we discovered that we weren't going to have to put anything realistically on credit or any, open up any additional line. We might zero credit card, but we don't have to. And honestly, like, we might get more rewards because of that. With cash back and different things, we could make money on the way, oddly. Yeah, true. But it's, you know, it's one of those things that we realized I was building it up, and then we sat down, looked at it, and we talked to you about it, and it was okay. Like, don't stress. You can afford to do it. Even if we took all your credit cards away. Yeah. Here's what your bank balance would be. Yeah. Right. And that. That is often the case. I can't tell you how many times I have that conversation with people? Because we put stuff on our credit cards, because you don't want to sit in the. With a bank balance of $1,000, you know, going into a wedding. So it's like, let's not do that. Let's use this 0% credit card or whatever and manage it. But the other thing that's happened as a result of this, and it kind of blew me away. But we've only been at this a year and really haven't changed your spending patterns at all. We've just documented them. And what's happened to your credit score? My credit score? So, I mean, I was pretty low when we first started this, but it shot up substantially. It was enough to the point where we were able to buy, you know, a car, where I've been able to build my credit. And you were, like, going around thinking, I'll never be able to borrow for all the right things ever because my credit score sucks and I'm a loser and all these things. Exactly. And we were. Now we're able to kind of plan for buying a house. We're able to plan for both of your credit scores. Exactly. And it's one of those things that just makes such a big difference. Because the biggest. All because of the b word. Exactly. And I think that the biggest thing, too, that this also goes down to, and this is a whole other conversation, but people just aren't taught enough about the financial aspects and the financial literacy that you need to survive in the world. That's why so many people go into debt. And that's why so many people have these issues and can't dig out. Yeah. Or think they can't dig out. Exactly. Yeah. And that's what I'm saying. This really applies personally, but as well with your business. And the second big point I wanted to make is when we do the reviews monthly and say you've overspent a category. Yeah. Do you judge yourself? Do you, how do we handle that? What do we do with that? Well, normally, if we've overspent in one category, we've underspent in a different category, and it kind of balances itself out of. But then the other thing, too, with this budget mindset that we have, the shift that we've been able to make, you know, we don't feel the weight of. Oh, we've kind of gone crazy in this area. It's. Okay. Well, we can afford to shift this budget. Is this going to be a consistent thing, or is this a temporary thing where we needed to do this. The key. Exactly. Remove the judgment. We're so harsh on ourselves. It's like you set up. If I set a budget and I blow it, quote, unquote blow it. I mean, right away, it's a negative term. Right. And the way we look at it is we set the budget because this is what we think we know. At the end of the month, we're gonna know different stuff, and some of that's gonna be decisions. Maybe it was a high stress month and you went to two Eagles games. You know, who knows what it is? I'm not going to another game for the season until we win. Help. Stress does it. But kind of the point is we don't go back and go, oh, wow, we overspent groceries. Well, that's bad. We go back and go, oh, there was an overspending groceries. What do we think happened? Oh, we had some people over for dinner that we didn't expect. Oh, is that going to happen every month? Oh, yeah. You know what? Probably one of the things we've discovered, like, we put gift money in, like, three months of the year. Yeah. We said gifts in March. I don't know, gifts in October and gifts in December. And what we realized is, over, like, three or four months, there was always a gift of some sort. So what do we do? Instead of going, oh, my God, you guys are just spending too much on gifts? We said there's gonna be a gift every month. Let's put that in and figure out where we might take it out from or if we want to sacrifice some of that savings. And that just. It's. It's just something that informs you instead of restricting and having you judge yourself. And I think so many people will fail in a budget process not because they overspend, but because they don't want to address them like, they don't. They feel guilty about overspending. Exactly. It's like, I failed. You don't fail because you overspend. You fail. If you stop, then because you. You're like, I suck at this. You don't suck at this. You're living life. Yeah. God, shit happens. Shit happens in life, especially when you run a business. Right. And sometimes we make decisions for reasons that don't make financial sense, and that's okay, too. Yeah. And that's kind of a big piece of what we talked about. So I don't. Maybe what we'll do is cut it off here, because I think the whole point of this discussion is budget not bad. Yeah, budget not bad. Budget freedom. Freedom. Yeah, we need a b word for freedom, but budget, be free or something. Budget and be free. But I do very similar conversation related to the business. Maybe we'll do that at the next event, at the next podcast is literally talk about, okay, how do we transfer that now into doing a budget and forecast for the business? That's nothing threatening but frees us up emotionally and mentally to do what we need to do. And I think that'll be a really good thing to harp on. I do want to, like, additionally, in addition, additionally, in addition, also for, you know, we're going. Yeah, we. This week we brought to the table another partnership that we're going to be working on. That's right. And building out these budgets and setting all of these things up for success in this way. It really allows us to make sure that every cog in the business is working to support itself. And the thing that's really good about this is one of the people that's a partner with you is somebody who had the same, has had still in the beginning phases of the same feelings you have about your personal finances. So it's a very cool thing for him to get to go through this together, both budgeting for the business and budgeting for himself at the same time. Yeah. And it really, you know, I just. After talking and having conversations with, with him specifically, you know, it's. He's going through that same journey that I am gone through. Like, I don't want to see. I don't want to see. I don't want to see. And I can really relate to that. And just knowing what is to come for him with the relief is huge. Yeah, it's awesome. And it's pretty much guaranteed, even if the tiger is a tiger. Yeah. And I honestly, in my lifetime have had a couple tigers where I'm like, oh, God, I really got myself in a hole here. And the only thing that gets you out is literally going, okay, this is what it is. And here are the next steps. And it just allows you the freedom to go, oh, it's gonna be all right. It doesn't just keep getting worse. It can keep getting worse if you don't. If you don't just do the thing to kind of get your hands around it. Yeah. Fight the tiger. Thank you so much. I really appreciate you sharing so much really personal information because it's a topic that I'm really. I'm really hell bent on. Deepen stigmatizing. Yes. Yeah. Yeah. Because there's not a human out there that hasn't had some sort of financial panic or issue or problem where there are some. Yeah, we don't need to talk about them, but most of us. Yeah. Been through something that's been like, oh, God, the sky's falling. I think it's so important, just from my experience, because through life, I haven't heard many stories in this way. Yeah. This way, this type of story. And if my story can help anybody, you know, relate or if anybody is listening to this or watching this and they can put themselves in my shoes from that point of view and just know that they can overcome it and that it doesn't need to be this thing that is impossible, the end of the world for you. You know? I love that. Yeah. I love to share it so that other people can feel that, you know, there's a. There's hope. There's hope. And I think it's important to know. A lot of times people share these stories and it's like, after they've become millionaires. Oh, yeah, I'm not a millionaire yet. Right. You're not a millionaire. And you're not, like, struggle free, and you're not able to just kind of, you know, not think about money at all. And that's, I think the point to make is you're still on the journey and you're sharing it, and I'm still on the journey and sharing it. So it's just not, and it should not be an embarrassment to anybody, anybody, to have what they perceive as money problems. Yeah. Sometimes they really are. Sometimes they're not. But thank you, because I think you're setting a really important example. Yeah, of course. And just, like, one more kind of thing to add on to. There is a lot of the people that you think have it all together are the ones that are feeling this way. Like, you know, I know so many people that looked at me and they thought that I was the one that didn't add it together, you know? And a lot of the people that you might think don't have this, they have a embarrassing money story, they have a struggle. They have anything that you are going through as well. What I'll do on the stage a lot when I'm doing speeches in rooms of anywhere from, you know, 20 to a thousand people, is, I'll say, look, right now I want you to think of your most embarrassing money story. Give you a minute to do that. Once you've got it, I want you to raise your hand, and I wait a couple seconds, and then I say, now I want you to look around this room, and then I'll say. Okay, keep your hand up. If you think yours is one of the most embarrassing money stories, almost no hands go down. Yeah. So whether it's the person who is clearing the tray from the room or the person who's running the event that you think has their shit together, their hands up, they've got an embarrassing money story, and either they're in the middle of it right now or they've had it at some point. So it's just, we really want to remove the shame. Yeah. Yeah. I love it. Cool. Well, thank you. Thank you, folks. Thank you for joining us for a practically pretty deep cash flow here today. I know. I didn't realize how deep we would get into that. I love it. I know. And I'm glad we did, though, because I really do think it was an important, not diversion, but an important dive before we talk about budgeting in the business. And I hope you all join us for the next episode because we will take that a little bit further. Not quite the emotional pieces of it so much as the practical pieces of doing a budget in the business once you've gotten over the hurdle of what does budget mean? So thanks for joining us. We're thrilled to have you. If you like this episode, please hit like subscribe, watch our other episodes. We are following along a journey here called fail or scale. We intend, no, not fail or scale or fail. We intend to scale, not fail. But we've started a partnership and we're going to talk through a lot of the things that we're going through as we build that partnership together. Yeah. So please stay tuned. Join us, have a beer with us every session, and then we'll always talk a little bit about the news as well. And we'll see you next week. We'll see you next week. Thanks so much for watching the cash Flow podcast with us. We want to bring more and more of this to you. So please like share subscribe comment so that we can keep bringing more of this content to.