and life you love. And today I’m so excited because we’re talking about one of my favorite

topics of all time: money. You know this if you’ve been watching the show. I love money.

I love what it can help you do in the world and obviously it touches every aspect of our

lives. So I think that no matter where you are economically and where I am, we always

have room for growth. Right? Not only in terms of our net worth, but, more importantly, our

relationship to money and how it impacts every decision that we make. My guest today has

made a huge impact on my financial life and my hope is he’s gonna help you do the same.

David Bach has helped millions of people around the world take action to live and finish rich.

He’s one of the most prolific financial authors of our time with 11 consecutive national

bestsellers, 9 consecutive New York Times bestsellers, with more than 7 million books

in print in 18 languages. His most popular book, The Automatic Millionaire, spent 31

weeks on the New York Times bestseller list. He’s a media favorite, having done thousands

of appearances on television, radio, and print, being on the Today Show over 100 times, and

Oprah 6 times. He’s also an entrepreneur as the founder of Finish Rich Media. His programs

have done over 100 million in sales and he comes to the table of financial education

with a lifetime of investment experience. What he’s most proud of , though, are his

sons Jack and James. David is married and lives with his family in New York City.

David, thank you so much for coming onto MarieTV.

It’s… I’m thrilled to be here, Marie. It’s great to see you.

It’s great to see you. And I wanted to just say publicly, years ago when I first picked

Smart Women Finish Rich it was such a lifechanger for me and ever since I’ve read so many

of your books. I’ve followed you for years and years and years. So this is like such

a beautiful, full circle moment because you were such a huge part of me getting my financial

life together and it’s just really an honor to sit here with you today because there’s

even more to discuss and money is one of my favorite topics in the whole wide world.

Little high five, give me that high five. Look, I… I’m so excited to be here. And,

you know, we’ve known each other… when did we meet? Like 10 years ago?

Yes.

And you’ve come so far. So I know now I’m here excited to be on your stage and I’m

so proud of you because you’ve accomplished so much.

Thank you.

So thank you for having me.

Absolutely. Well, one of the first places I think most people think of when they want

to get their financial life together is let’s go to the numbers. Let’s break out the checkbook,

let’s get the spreadsheet open, let’s start adding things up, and you have a different

approach. You say that’s… that’s not where we should start and it’s kind of counterintuitive.

In fact, you write, “We need to start with our values because your values can determine

how hard you’re willing to work to achieve your financial goals…”

Right.

“...how much money you currently spend, and how much money you will actually need

for retirement.” So walk us through the importance of starting with our values and

how we can do this.

Ok, well, so I love the fact that you started with the hardest thing that I teach. But it’s…

it is the most important thing because when your values are clear, your financial decisions

become easy. And… and the biggest thing that holds us back, we all know what we should

do. I mean, most of what I’ll talk about today, people know they should do it. Everybody

knows you should save more money and they should pay down their debt, all these things

that we know we should do. We should have a will, we should have life insurance. We

should ourselves to death. We… we don't do what we know we should do and that’s

because there’s a disconnect. So the way you break through the disconnect is by being

clear on your values. So this is hard to explain, like, with sound bytes but I’ll give you

an example from, like, being on… when I teach this stuff on stage.

Yeah.

Or with my clients one on one. You know, you’ve got a friend of ours, Tony Robbins was here

recently. He did the… his new book and Tony and I and Donald Trump did this tour together

for a while where we toured all over North America, the US, and Canada. This was before

the recession. And we would have these huge venues, you know, between 15 to 30 thousand

people. Unbelievable. So much fun. And I would come out on stage and the first question,

you know, everybody’s fired up. Right? You’ve got 30 thousand people in a room and I’d

come out and I’d say, you know, “I… I have a question for you. And my first question

is, do you wanna be rich?” And you’ll… everybody’s all fired up, right? So they’re

like, “Yeah! We wanna be rich!” I’m like, “Turn to your neighbor, tell him how

rich you wanna be.” “I wanna be rich!” Everybody’s all excited, right? And then

I let the room get quiet, which if it’s a big room that’s pretty, you know, like

take the… I just stand on stage and let the room quiet down. And I’d say, “Really?

You want to be rich? Why?” And everybody would start looking at me like... “Why do

you wanna be rich? Some of you, by the way, you said you wanted to be rich. Some of you

just want to be financially secure. Right? Like, some of you are here just to be secure.

By the way, some of you are here to just get back to even. You’re like, ‘I just don't

wanna be in debt anymore.’” So I said, “But my question is, why?” Now, the way

we’re programmed and the way we’re marketed to, your brain starts… you ask a question

and your brain starts looking for answers. People then think that their answer is supposed

to be a goal. It’s supposed to be a numerical money goal. Like, “Well, I want a million

dollars or I want a bigger home or I want a bigger car.” And goals are really important,

but they’re not where you start. Because what happens is people get all motivated and

excited about a goal, but then the real world hits them and as soon as it gets hard they

get off track. So what I’ve taught for, God, almost 20 something years, and it started

with my clients in Morgan Stanley, is, yes. We’ve got financial goals, but we’re gonna

look at values first. And when you get clear on your values, you’ll be unstoppable. And

then we can take your values, what you just said is most important to you, and we can

align them with your goals so that they come together and they’re not in conflict. And

then nothing can hold you back.

And so what are some of the most common values that you have seen that people either have

not articulated, like is it freedom, is it family, is it, you know… I don't know. What

are some of the things that people…?

Well, so, like, you know, in the book I give you, like, a list of values. Right?

Yeah.

But don't… you don't just have to copy them. Right?

Right.

Like, people have pretty common values. You know, family, security, freedom, making a

difference. The… here’s what you do, because it’s not that complicated. You take out

a pad of paper, you can do this in 5 minutes, and you write out all your values. All the

values you can think about. And then what I recommend you do is you circle 5 of them.

You come up with your 5 favorite values and I… in the book, Smart Couples Finish Rich,

it’s a value circle. In Smart Women Finish Rich it was a values ladder and I’ll just

explain the difference for a sec.

Sure.

Because in Smart Women Finish Rich I taught people a hierarchy system which was identifying

your highest value. And, by the way, for some people that was tough. So I started realizing,

like, it’s not just about your highest value. Let’s look at your 5 most important values,

get them down on paper, if you’re in a marriage or relationship have your partner do this.

Once the value is down on paper, then let’s look at your money. And let’s look at are

you spending money in a way that is getting you closer to your values or are you spending

money in a way that’s getting your further from your values? And so what I really find

when I work with clients or coaching people one on one, a lot of people’s lives are

in complete conflict with their values and they don't realize it. Once they see it on

paper, it’s like a huge wakeup call.

Wow.

That can apply to everything, that can apply to your business, that can apply to your health.

So I don't think… and also the key about values is it’s like… it’s God given.

Right? Like, people are basically born perfect. Right? Like, there’s… you’re good the

way you are. It’s inside of you. The magic pill that we’re all looking for, it’s

already in you. You just have to get clear about it.

Yeah. I love that. And it gets us in touch too, for me, there’s such a sickness in

what I see in society with more, more, more, more, more. Just like that question, “Well,

why do you want to be rich? Do you really want those things?” And I’ve had several

points in my career where I feel like there was a lot of external noise to go bigger and

go for a TV show and do this and you should want…” and I really always had to stop

and check myself because it felt so out of alignment with who I genuinely am and what

I want. And this great question of, like, well, how hard are you willing to work? And

is it really worth it? So I love this idea of starting off with our values and getting

some alignment between what we say is important and how we demonstrate that through…

It’s really being authentic. Right? Like, what you're talking about is who’s your

authentic self.

Yeah.

And also, another thing that holds people back sometimes with money is that they think

that money is bad.

Oh, goodness gracious. Yes.

A lot of people have all kinds of mental issues about money because they were raised, “Well,

money. Those people over there, they’re bad people.” When you’re authentic yourself,

there’s nothing bad with building wealth. Building wealth can free you to live your

most authentic self. So to me that’s about living rich.

Yeah. And in my own life, money has been such a tool for healing and for good and so I have

a really powerful association that it’s a beautiful thing and that’s actually one

of the things I’d love to talk about is is so many people there’s a lot of conflict

around that. I want it but I shouldn’t want it and it makes me an unspiritual person or

it makes me greedy and all this stuff. So great stuff. There’s one big mistake that

you say that many of us make with our financial life and fixing it can take less than an hour.

We like quick fixes, especially this one that’s this powerful. Tell us about automation.

Ok, so I wrote this book called The Automatic Millionaire.

Brilliant.

And the purpose of that book was everybody coming to me saying, “David, just tell me

the one thing I need to do because I don't wanna go through the 9 steps or the 7 steps.

I wanna know the one thing.” And I found myself telling people over and over again,

“There’s this one thing you need to do, and that’s make it automatic.” And they,

“Well, what does that mean?” So I had to break it down and here’s where it starts.

Let me tell you what doesn't work. Ok, so what doesn't work, this is gonna piss some

people off but I’m gonna just say it. Budgeting is what doesn't work. So most experts for

years come out and say, “Well, you know what you need is a budget. You need to, you

know, you need to put the money into different categories and then we’re gonna figure out

where the savings is gonna come from and then we’re gonna… at the end, you know, take

this money here and put it over here.” It doesn't work. Budgeting doesn't work and you’ve

been told to have a budget and use discipline. And the reason it doesn't work is because

out in the real world people hate budgeting. They do. It’s like dieting.

Yeah.

Even if they go on a budget, they will still break the budget later. And in the real world

most of us are wired one of two ways. So some people are actually born to budget. They literally

came out of the womb with a calculator and they wanna track where all the money goes

and they’re like… they’re into this. Right? Then there’s the person who… who’s

the opposite of that, which is the spender. And typically we fall in love with our financial

opposite. And that… that creates a lot of fights. So what you do is you go, “Look,

budgeting doesn't work, discipline doesn't work. You need to throw that nonsense out

and you need to just make it foolproof and you need to make it automatic.” And so what

I teach is this, there’s basically 6 or 7 things that you automate. So I can break

it out for you if you want.

Yeah, go for it.

So… and this is how my life is. Right? Like, my life takes 10 minutes a month to track

the… my financials… all my finances. 10 minutes a month. And this is… that’s about

how long it should take for anybody. So, first of all, if you’re… if you get a paycheck,

this is obvious, but the first thing is is that that paycheck gets deposited automatically.

Most people get a check manually still to this day. Do you not get…?

Really.

Still to this day are getting checks. Now, they may be taking a picture with their phone,

although that… if it’s a big check they can’t do it with their phone, they’ve

got to bring it into a bank. That’s why there’s bank branches everywhere. So that’s

insane. So first your check should be deposited automatically. If you’re self employed or

you have your own business, smart businesses all the money comes in automatically. All

my clients for the most part, like 95% of those checks are hitting my business account

automatically. So that money is coming in automatically, now the question is where does

the money go next? So there’s different buckets that the money goes into. The first

I call it a basket is pay yourself first. So you’ve got a pay yourself first basket,

and that’s usually… that’s your retirement account. And I recommend at a minimum you

pull 10% from that automatic deposit right into a retirement account. Minimum 10%. Ok,

so now we’ve got 90 cents left. And now we’re gonna pull some money off into a security

account. That security account is for emergencies. People get confused on emergencies. “I need

to redo my kitchen.” Not an emergency. Right? You know, like, “I want a new car.” Not

an emergency.

Yeah, subway tiles in the kitchen.

These new shoes just came out. Not an emergency.

Not an emergency. Right.

Emergencies are emergencies. So that money gets put into a separate account with no checking,

no ATM card. Then money starts to go into all the expenses automatically. So anything

that can affect your credit score: your mortgage, automatically paid. Always. Your credit cards,

minimum payments always paid automatically. So, like, let’s say your minimum payment