Introduction

I hate the sound of my alarm clock.

There I am, perfectly happy and content, warm in my bed, dreaming away when, out of nowhere, that annoying upbeat ring starts going off. My alarm jolts me out of dreamland and drops me into a dark, new morning. It takes everything in me to not hit the snooze button—or throw my phone against the wall. I’m not even sure God’s awake at 5:00 A.M., but I am. Now. Oh, how things have changed.

It wasn’t always like this. Early in my career, I’d wake up around 7:00 A.M., roll out of bed, get ready in a rush, grab some coffee, and run out the door to get to work on time. Most mornings felt like a blur, and my body was basically on autopilot while my brain kept on snoozing. I didn’t value or even enjoy that first hour of the day. My morning habit was simple: get up, get ready, and get out—as quickly as possible.

But my life’s a lot different now. When I became a mom, I realized pretty quickly that if I wanted to have any time to myself at all during the day, I would have to get up early. The demands of being a wife, mother, speaker, writer, and frequent traveler can exhaust me if I don’t secure a few precious moments of peace and quiet at the start of the day. I need time to prepare for the day ahead of me by gathering my thoughts and enjoying a cup of coffee before my daughter wakes up and I have to get her ready for the day. If I skip that first part of my day, I don’t feel as focused or productive. And if I tried to carve out some quiet time for myself later in the day, it would never happen. The only way possible was to create a new morning habit of getting up a couple of hours earlier than before.

That meant I would have to get up before the sun and get used to seeing 5:00 A.M. flashing on my phone’s alarm. Getting up that early used to feel like a punishment; now, it feels like a gift. I’ll admit, the first few weeks of this new routine were a little rough. I was tired, I got mad at myself for staying up too late the night before, and I wasn’t used to tiptoeing around the house in the dark. Over time, though, I grew to value those early morning hours. I liked how having that time made me feel. I felt more present with my husband, Winston, and our growing family. Now I don’t even have to think about it. I just do it. It has become a habit for me.

LIVING WITH HABITS

People tend to have different reactions to the word “habit.” Some people immediately take a negative view. To them, a habit refers to “bad” habits like cracking knuckles, biting fingernails, or smacking gum. The thought of creating new habits may sound overwhelming and breaking old, bad habits may sound intimidating. These people cringe when I bring up the idea of habits because they’re naturally inclined to think I’m calling them out on something they need to change, and that sounds like a lot of work to them.

Other people are just the opposite. They see habits in a positive light and think of healthy disciplines that enhance their lives. They think of things like turning off their smart phone during dinner to focus on quality time with their family, saving up to pay cash for purchases, working out regularly, eating healthy food (most of the time, at least), setting the house alarm before walking out the door, and brushing their teeth at least twice a day. These people light up when I talk about habits because they’re always looking for some “life hack” to get where they want to go.

We All Have Habits

The word habit means acting or behaving in a usual or predicable way. It’s really what a person does on a regular basis. Habits are those things you do that you don’t have to think hard about, an automated response to what’s happening around us. My old morning routine (get up, get ready, get out) was definitely a habit. That’s what I meant when I said I was on autopilot. My body just knew what to do, so the habit took over while my brain was still snoozing.

Charles Duhigg talks about this in his incredible book, The Power of Habit. He writes, “When a habit emerges, the brain stops fully participating in decision making. It stops working so hard . . . So unless you deliberately fight a habit . . . the pattern will unfold automatically.”1 When a choice is made consistently, it becomes a habit. And habits, according to Duhigg, are automatic. In other words, you don’t even think about them.

For example, how hard do you have to think about each turn on your daily commute? How often do you get lost on your way to work or to your kids’ school? I’ve driven the same route so much that my brain shuts down a little bit when it’s time to drive to work. In fact, I had the weirdest experience the other day. I needed to pick a few things up at our local warehouse store, which is located one street over from my office. Apparently, I completely zoned out while I was driving, because the next thing I knew, I was sitting in my office parking lot. In my normal parking spot. On a Saturday.

I laughed at myself when I came to my senses, because I knew exactly what had happened. I was heading in the direction of my office, so my “drive to work” habit took over. Even though I was working on a book about money habits at the time, I was still surprised at how powerful that routine was. It really made me realize how important it is to not just be aware of your habits but to take control of them if you want to truly take control of your life.

Facing Our Money Habits

Habits affect every part of our lives, including our health, careers, productivity, relationships, and especially our money. We all have money habits. Some are good, and some are bad. Some take us closer to where we want to be, while others take us further and further away.

You may be in the habit of using cash for purchases, or maybe a habit makes your credit card magically appear in your hand whenever you’re in a checkout line. You may have a habit of talking to your spouse before making a major purchase, or maybe you have an impulsive habit of hiding your purchases when you get home. Like it or not, our money habits are impacting our financial lives every single day. And if that’s true, we’ve got to figure out how to harness the power of habit in order to live the lives we want.

That doesn’t mean I always enjoy it when a healthy habit kicks in. I’m a natural spender. We’ll talk more about that later, but for now, just know that I love spending money. That’s my natural bent. However, I have some healthy money habits that keep my spending in check. So, when I walk through the doors of J. Crew and my natural impulse to buy everything in site lights up, those instincts crash against my habits of not using debt, planning my spending, and talking to my husband about my purchases. Those are habits Winston and I have carefully added to our lives, and they’re setting us up to live the life we want and do the things we value over the long term. So if occasionally feeling a little tension in J. Crew enables us to hit the goals we’ve set for ourselves, sign me up!

The truth is, though, breaking bad money habits and replacing them with good ones can be easier said than done—especially if you don’t realize how much your bad money habits are wrecking your life. I’ve talked to people who went years—even decades—going deeper and deeper into debt. When they wanted something, they just charged it to their credit card. It was an automatic response for them. They had no concept of the damage it was doing in their lives. Even if they suspect that there’s a problem with their spending habits, they haven’t felt the pain to change. And without that little push, it can be incredibly difficult coming up with the emotional energy to change a longstanding habit.

But if you want to change your life, if you want to do the things you’ve always wanted to do and buy the things you’ve always wanted to buy and go to the places you’ve always wanted to go to, then you’re going to have to find that motivation to change your money habits. You need to aim the power of habit at the behaviors that will make your life better instead of tearing it apart one mistake at a time.

And don’t worry about the mistakes you’ve made in the past. I’m not interested in beating you up for past mistakes; I want to encourage you to make wise choices—and to build healthy habits—moving forward. I can’t promise it’ll be easy, but I can promise it will lead to a happier, healthier, more peaceful life—a life without all the debt, stress, and worry that so many of our friends are dealing with right now.

LET’S GET TO WORK

You have the opportunity to create the life you want. Though it may not feel like it right now, it’s within reach—not thirty years from now, but right now. Change happens when you own up to the choices you make. If you don’t like the outcomes you’ve created for yourself, such as debt, unhappiness, or dissatisfaction in general, then start making different choices that will create new habits in your life.

As we go through this book, I want to shine a spotlight on the habits you need to take control of your money and to be able to afford the things you value. These money habits may not come easy to you and you may not get it right every time, but, as Larry Gelwix says, “Practice doesn’t make perfect; practice makes permanent.” And permanent, positive change is what we’re after.

Some of the principles in this book may sound familiar. There’s a reason for that: My dad, Dave Ramsey, has been teaching many of these things for decades. And before Dave Ramsey, there were financial giants like Larry Burkett, Howard Dayton, and Ron Blue teaching basic personal finance to everyday people. Ideas like staying out of debt, using cash for purchases, talking to your spouse about your money, and living on a budget aren’t new, revolutionary ideas. The problem isn’t that people haven’t heard what to do; the real problem is that most people just don’t do it. And in the age of one-click purchasing, social media pressure, online banking, and instant gratification, things are only getting worse.

I grew up with these principles. I’ve gone my whole life without debt and living on a plan for my money. I know this stuff works, but the world’s changed a little bit since Dad first started talking to people on the radio. This generation of young families is facing new pressures and temptations that our parents never had to deal with. Today’s challenges and opportunities are uniquely ours, so let’s figure out how to manage them together.

While I’d love to only stick to the positive side of life, there are times when I’m going to have to be the friend who loves you enough to tell you when you’re going off track with your money. That means making you aware of some bad habits you may already have, because I know how easy it can be to allow bad habits to take you far off course from where you want to go.

As we get started, I have good news and bad news. The good news is that we’re going to start with the one habit that has the power to change your financial life more than any other—and it’s not what you think it is. The bad news is that it might slap you in the face with something you don’t want to deal with quite yet. It might be a little tough, but it’s a worthwhile journey. Breaking, building, and rebuilding habits can be hard work, but it’s the only way to get to the life you’ve always dreamed of. You ready? Let’s get to work!

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Chapter 2

Blessed vs. #blessed

There is a fascinating phenomenon racing through social media these days, and we’ve all seen it. It’s there, lurking at the end of half the posts you see online. It’s the smiley, happy exclamation point at the end of a friend’s latest post about her fantastic vacation. Most of the time, you can see it coming before you get to the end of the photo caption. It’s the latest weapon in the comparison-driven war of one-upmanship currently being waged on your favorite social networks. Yes, it’s true: I’m talking about #blessed.

“Look at what my amazing husband gave me for our anniversary! #blessed”

“Honored to accept my new position as Executive Vice President of Sales for a Fortune 500 company. #blessed”

“I can’t believe this view out my new bedroom window! #blessed”

“Jetting off to Hawaii for a long weekend! #blessed”

“I’ve always wanted a Lexus! #blessed”

“Oh, he shouldn’t have! #blessed”

And the pictures—oh, the pictures. New cars. Amazing sunsets. Six-pack abs. Rooftop pools. First-class airline seats. #blessed #ilovehimsomuch #treatingmyself #YOLO

And I’m the first one to admit I’ve been guilty of using #blessed in the past, but once I became more aware of this habit of comparison living, I started paying more attention to when, where, and why people throw in that little hash tag. And, almost every time I see it now, I translate it as a humble brag.

Am I saying that everyone who uses #blessed means to imply that? No way. I know some of the sweetest, most caring and generous people in the world. There’s no way that’s what they mean to say. There are others, though, that know exactly what they’re implying with it. We can’t control that. All we can control is what our response is when we see it. If we seriously want to develop a habit of quitting the comparisons, we’ve got to take control of our thoughts and reactions to other people’s stuff and success. We need to choose real blessings and let go of someone else’s #blessed. So let’s talk about how to do that.

HOW TO QUIT THE COMPARISONS

Quitting comparisons is hard to talk about. It can be tough to identify clear steps to win, and it’s impossible to talk about the issue at all without stepping on a lot of toes. No, I haven’t figured it all out yet; this is something I’m still working on myself. However, I can share with you some specific steps I’ve taken and principles I’ve applied to my own life to help me take my eyes off of other people and put them back on creating the life I want to live for myself.

Step 1: Change Your Perspective

In the last chapter, we said that what we see on social media doesn’t always reflect reality. It’s usually not the complete picture of someone’s life; it’s just the highlight reel. That’s true for other people, and, if we’re being honest, it’s true for us, as well. It’s not just a social media issue, however. Our perception of reality can be just as skewed in real life.

Stuff Doesn’t Equal Wealth

One of the most surprising lessons I learned as a teenager is that nice stuff doesn’t equal wealth. I remember one time when a group of girls from school decided to go to a concert together. One girl in our circle of friends, however, couldn’t go. She couldn’t afford the $100 ticket. Now, don’t get me wrong; paying $100 for a concert ticket in high school was a big deal. I had to do hours of babysitting to earn that money! What surprised me, though, is that this friend drove a brand-new luxury car. She wore designer clothes, and her family lived in a super-nice house in an expensive neighborhood. I just couldn’t wrap my head around the fact that this girl, who looked like she could do anything she wanted, couldn’t afford a concert ticket.

I talked to my mom about it that night. I said, “Mom, how could she not afford a ticket? She’s rich!”

My mom looked me in the eye and said something I’ll never forget: “Rachel, that’s what debt does. It makes people look better off than they actually are.” Translation: Just because someone looks wealthy doesn’t mean they actually have any wealth. This may or may not have been my friend’s situation in high school, but someone’s nice cars, fancy jewelry, and giant houses could all be based on debt. The show on the outside may not match the truth on the inside. The lesson there for me was that I shouldn’t wish I had someone else’s life. Getting their stuff also means getting their problems, and you never know what anyone else is struggling with.

Don’t get me wrong, though. I’m definitely not saying that everyone who has nice things uses debt to get them. A few years ago, a friend confided in me that she and her husband were in major financial trouble. They weren’t careless with their money, but life had dealt them a tough blow. She was a teacher, and he had just lost his job. They were barely getting by on her teacher’s salary alone. Every time I saw her, however, she was wearing a new pair of expensive yoga pants. It may sound silly, but this really started bothering me. I told Winston, “I can’t believe she has so many pairs of those pants! They can’t afford to spend that much on something so trivial. What are they thinking?”

Soon after, she and I were hanging out with some other friends. I overheard her telling someone else that some of the moms of the kids in her class had pooled their money and given her three pairs of those pants for Christmas. She went on and on about how grateful she was for the gift because it gave her the chance to have something nice for herself while she and her husband were facing their money troubles. I felt terrible. I judged her for something that wasn’t even true. It was another hard lesson that you can’t trust your assumptions based on other people’s appearances.

Wealth Doesn’t Equal Stuff

An interesting twist on all this is that it’s also true that wealth doesn’t necessarily mean having nice stuff. Sometimes we get this image in our heads about what millionaires look like and how they live, but that’s usually based on bad assumptions or television’s portrayal of “rich people.” The truth is, people who are actually wealthy live a lot differently than you might expect.

The late Thomas Stanley wrote a fabulous book called The Millionaire Next Door. He spent years studying the behaviors of the average millionaire (someone with a net worth of a million dollars or more). He meticulously reviewed their lifestyles and concluded that these successful men and women look more like “regular people” and not at all like the fancy, well-dressed, well-to-do rich people you see on TV.

One of the things he discovered was that the average millionaire drives a two-year-old or older car. Why? Because when you have as much money as they do, you don’t care what other people think! As Stanley interviewed these millionaires, a high percentage talked about how they drove used cars and lived in modest homes. They weren’t flashy and were pretty conservative in their spending. It was refreshing to read and a good reminder that again, things aren’t always as they seem.

Step 2: Cheer Each Other On

I love working at my dad’s company, Ramsey Solutions. We do important work and we get to help people all over the country take control of their money and get out of debt. Some of the success stories we hear blow me away! The really cool part, though, is the way the team members celebrate each other’s progress.

You may think that everyone in our office is debt-free. Not true. Our team members represent every stage of the financial spectrum. We may all be at different places on the journey, but we’re all heading the same direction. So, we have some millionaires on the team, and we have some people who are fighting through tens of thousands of dollars in debt. And, of course, we have a lot of people somewhere in between. We all dress pretty casually, so it’s hard to tell who’s doing well and who’s struggling under a pile of student loans. But the one place you can really get a sense of our variety is in the parking lot.

When you pull in, you will likely see a Lexus and a Mercedes. And you will also see a 1980 Chevy Nova with duct tape, rust, and a mix-and-match paint job. But the person getting out of the Mercedes doesn’t look down at the person driving the Nova. It’s exactly opposite. They cheer that person in the junky car on because they know how hard they’re fighting and the sacrifices they’re making to get out of debt.

The guy in the Nova doesn’t roll his eyes at the people who drive nicer, newer cars either. Again, it’s the opposite. The one in the Nova doesn’t plan to drive it forever; he looks at the people in the newer cars as huge encouragements, as a sign of where he wants to be himself. There’s no comparison game going on here. Instead, we’re all cheering each other on. It’s an incredible attitude that you can adopt yourself, even if everyone around you doesn’t. But you can’t do it if you’re always comparing your life to other people’s. Constantly comparing ourselves to others prevents us from cheering on the ones working hard to get somewhere and celebrating with the ones who have made it there.

So here’s the challenge: When a friend tells you about her new job, be happy for her. If someone buys a new house, show some excitement. If someone shares some great news with you, keep the focus on them instead of turning it back to yourself. Find big and small ways to celebrate other people’s accomplishments. That’s one way we get to show love and support to others. It’s like the Bible says, “Rejoice with those who rejoice” (Romans 12:15, niv). Don’t feel like you’re losing just because someone else is winning. Their success has nothing to do with you, so celebrate their success sincerely while you keep working toward your own.

Step 3: Stop Looking at Your Parents

My parents live in a beautiful home. Seriously, it’s amazing. They have worked hard and have been responsible with money for decades, and I’m so proud that they’re now able to enjoy what they’ve worked so hard for. You know what I don’t do when I look at their house? I don’t try to figure out how I can buy the one next door. At this point in my life, that’s just not going to happen.

Mom and Dad have a 30-year head start on Winston and me. We may get where they are one day, but we aren’t there today. I bet the same is true for you. And yet so many people graduate college, get married, start their careers, and immediately expect to be able to live the same kind of lifestyle as their parents. It’s crazy! Why in the world should someone with a starter salary assume he can live just as well as his hard-working, almost-retired parents? Answer: he shouldn’t.

Winston and I try to keep this in perspective, but sometimes it isn’t easy. Sure, the big things like houses or cars are easier to keep a handle on, but I still get tripped up on the little things sometimes. A few years into my career, I went out to eat with my parents and noticed a beautiful new purse my mom had just bought. I told her how gorgeous it was and that I wished I could get one just like it. Without really thinking much about it, she said like any sweet mom, “Oh sure, honey! You should go buy it!”

When I got home from dinner, I went online to order it and saw the price. Yikes! To say it was a little out of my “newlywed-only-working-three-years-in-the-real-world” budget would be an understatement. At that point, it really hit me that was I was still in my early twenties. While I had been working hard for those three years, it didn’t grant me the right to go buy whatever I wanted. I needed to live like I was in my early twenties—not like I was in my early fifties. Comparing ourselves to our peers is bad enough, but comparing ourselves to people decades further along in their careers and wealth building is just ridiculous.

Step 4: Redefine “I Deserve It”

One of the biggest dangers in comparing yourself to someone else is the spirit of entitlement it can create. We see someone else’s success and think, I work harder than he does. I should have what he has. I deserve it.

“Deserve” is a dangerous word, and it gets people into more trouble than they’d ever expect—or admit. The idea that the world owes you something is the root of why so many people live in a constant state of dissatisfaction and jealousy.

I know I can get this way at times. I start to tell myself why I deserve whatever I want—or better—why I should have the same or better than someone else. I tell myself, Rachel, you work so hard. You should take a nice vacation. You need newer clothes than what you have in your closet.

Reality check: Whenever I do this, I’m having a classic Veruca-Salt-from-Willy-Wonka-style tantrum. I might as well stomp my feet and scream, “I want it! I want it right now!” It’s hard to admit that I do that occasionally, but I do. And these pity parties are almost always when I’m alone in my car or by myself at home. They usually happen in my head and last for about half an hour before I come back to reality and snap out of it. Maybe—just maybe—I’m not the only one?

I have to stop in those times and remind myself that I don’t deserve anything. The only things I deserve to buy are what Winston and I plan for and pay cash for. That’s it. Period. If it’s not part of our plan and we don’t have the cash on hand, we make it a goal to work toward in the future. I have to remind myself that having it right this second isn’t an option, so I just need to move on. How’s that for a pep talk?

Step 5: Own Your Stuff

Growing up, I always heard my parents say, “It’s okay to have nice stuff; just don’t let your nice stuff have you.” What he meant is that we sometimes give in to the pursuit of stuff for the wrong reasons. People make bad decisions and go into debt for things they don’t need and can’t afford. Then, once they have the thing they think will make them happy, they get distracted by something else and start chasing after it instead. The end result of this is a big pile of nice stuff with a lot of debt and misery attached.

The road of comparisons always dead-ends at debt. Remember, it’s okay to have nice things. There’s nothing wrong with enjoying a little luxury as long as it makes sense in your world. However, when you pile up a bunch of stuff and go neck-deep into debt to buy it all, you don’t really own your stuff; it owns you. The debt takes over, steals all your income, and you suddenly become a servant to the things you thought would make you happy.

We’ll talk a lot more about debt and wise spending later. For now, I just encourage you to examine your buying motives before you make a purchase. If your identity and your life’s worth are wrapped up in what you’re buying, you are setting yourself up for disaster.

THE CURE FOR COMPARISONS

Too many people in the world are letting cultural expectations—that is, other people—dictate their own values and family priorities. I’ve been there too. I know it’s an empty and endless battle to try to keep up. You feel like a hamster on a wheel, running as hard and fast as you can, but ultimately going nowhere. Doing that for a lifetime will leave you completely exhausted. Don’t do that to yourself anymore. That doesn’t have to be your life. There is hope; there is an antidote. There is one and only one cure to comparison living, and that is contentment.

What Contentment Looks Like

In our book, Smart Money Smart Kids, my dad and I make the point that content people don’t always have the best of everything, but they make the best of everything. Contentment isn’t a place you get financially; it’s a place you get emotionally and spiritually. It’s a peace in your spirit that knows what you have, no matter how much or how little, is enough. Contentment is the inner determination to be happy and fulfilled wherever you are with whatever you have. The Apostle Paul put it like this: “I have learned to be content whatever the circumstances” (Philippians 4:11, niv). And yes, I know this is a lot easier said than done.

I wish I could give you specific steps to take to guarantee your contentment, but I can’t. I will tell you the two big secrets to living a con-tented life, but before we get there, let’s take a look at what a con​tent person looks like. You may realize that you have so

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