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1:00

The bigger risk is we toxify failure

1:02

so much that people are then unwilling

1:05

to speak up with the small signals

1:07

that something might be off in

1:09

time to catch incorrect and then

1:11

avoid the big failures. Because I'm a

1:13

big fan of avoiding big failures. Hey

1:20

everyone, I'm Jean Chatsky. Thank you so much

1:22

for joining me today on Her Money. Move,

1:25

fast and break things. That

1:27

was Mark Zuckerberg's now famous

1:29

early motto for Facebook. Fast

1:31

forward to today. Many

1:34

startup founders have come to

1:36

live by this idea that

1:38

if you're not getting messy,

1:40

if you're not failing often,

1:42

you are not making progress

1:44

and you're definitely not creating

1:46

the next Facebook. Recently,

1:48

though, there has been some

1:50

backlash to this startup

1:52

culture mentality, especially in

1:54

the wake of the

1:56

2018 Cambridge Analytica scandal

1:58

where millions of

2:01

Facebook users data was

2:03

used without their consent

2:05

to create targeted political

2:07

advertising. Zuckerberg later apologized.

2:09

He called what happened

2:11

a mistake on Facebook's

2:13

part. And that remark

2:15

from that guy, the move fast

2:18

and break things guy, it struck

2:20

a sour note with a

2:22

lot of people. Why? Because

2:24

this was a huge failure.

2:26

This was not a simple

2:28

mistake. So where's

2:31

the balance? What's the right

2:33

way to fail? Because we

2:35

all fail sometimes. What's the

2:37

right way to fail without

2:39

imploding? How can we encourage

2:41

creativity and innovation and at

2:43

the same time not move

2:45

so fast that we

2:47

harm others and look or

2:50

even are acting in

2:53

a completely careless manner? Amy

2:56

C. Edmondson is joining us

2:58

today to explain the difference

3:01

between bad failure and

3:03

something she says we should all be

3:05

seeking out in our day to day

3:07

lives. Good failure. She

3:09

is the Novartis Professor of

3:12

Leadership and Management at the

3:14

Harvard Business School was recently

3:16

named as the number one

3:19

management thinker in the world

3:21

by Thinkers50 and she's

3:23

got a new book out called

3:26

The Right Kind of Wrong, The

3:28

Silence of Failing. Well, Amy, welcome.

3:30

Thanks for being here. Thank you

3:32

so much for having me. You

3:35

start this book with a quote

3:37

from Churchill and he said, success

3:39

is stumbling from failure to failure

3:41

with no loss of enthusiasm. From

3:44

the outside looking in when I

3:46

think about the women that I

3:48

look up to in big corporate

3:51

jobs or with large influential platforms,

3:54

it doesn't seem like they're stumbling all that

3:56

much at all. What would you say to

3:58

that? Well, I

4:00

would say we're not seeing

4:02

everything. Thankfully I there's no

4:05

need for us to see

4:07

everything in everyone's life. I

4:09

would argue that. Overall, Those

4:11

who are achieving great

4:13

success have very likely

4:15

sailed more often. Than

4:18

the average person as they just

4:20

they feel smart, they fill in

4:22

good ways, meeting, they're willing to

4:24

take risks. In new Territory knowing

4:26

that not all of them will

4:28

work out, but not all of

4:31

them will produce the hoped for

4:33

success in that moment. But.

4:35

All of them will give

4:37

you new information, new learnings,

4:39

new ideas to. Where

4:42

do you go next? You have had

4:44

great success but you have also sales

4:46

are quite open about that. You had

4:48

a big sale when you were a

4:50

P H D student and I know

4:53

that you learned a lot from that

4:55

and that it kind of set you

4:57

on this path. Tell me about it.

5:00

Was. Oh must not quite say

5:02

or because the way you ask the

5:04

question made it sound. Like how I'm

5:06

about to tell you something far more

5:09

embarrassing, which I certainly could, but. The

5:11

will tell you that story, but

5:13

it's a research contact for it

5:15

and in research you will often

5:17

be wrong. So a and intelligent

5:19

failure in the context of research

5:21

is a hypothesis that isn't supported

5:23

by the data. I. Was

5:25

a part of a larger study

5:28

and my hypothesis was the better

5:30

team work in healthcare delivery setting

5:32

Hospitals. Would. lead

5:35

to fewer medical error

5:37

and unfortunately the data.

5:41

Seemed. To be saying. That.

5:43

Better teams had higher not

5:46

lower error rates are. So. That

5:48

was xactly the opposite of

5:50

what I'd predicted and was

5:52

quite disturbing, Confusing. and of

5:55

course, my initial reaction. Upon

5:57

seeing the data results was too.

6:00

Have my thinking in a spiral out

6:02

in and unhelpful way. And

6:04

to try to think about will what will

6:06

I do now after I drop. Out

6:08

of graduate school. Now that's a

6:10

classic case of off allies and

6:12

or catastrophizing when in fact, it's

6:15

just. Data It's maybe inconvenient at

6:17

that moment and is puzzling

6:19

are disturbing at that moment.

6:21

But it's truly not catastrophic

6:24

and. What? Happened next

6:26

was a I had to I just sit and

6:28

think. Very deeply about it and try

6:31

to figure out what. Might be

6:33

explaining those results and it occurred

6:35

to me that in better teams.

6:37

Maybe they have a higher

6:39

comfort level. Reporting.

6:41

Mistake. So that in fact, The data

6:44

on. Error rates might

6:46

be flawed data rate as opposed to

6:48

I was pretty sure that the veracity

6:50

of my team survey data what was

6:52

strong. By the suddenly occurred

6:55

to me that. The

6:57

medical researchers ability to

6:59

actually get solid. Accurate.

7:03

Data on error rates might be

7:05

harder than it. First lox, big

7:07

sale years. You obviously can't. Hide

7:09

but many of the little things that

7:12

go. Wrong. can easily go

7:14

under reported. As we all know

7:16

in our day to day lives. So

7:18

that's what I began to think my

7:21

be happening. I thought okay, if that's

7:23

true, then that means even within the

7:25

same hospital context, we've got real differences

7:28

in people's attitudes about mistakes and failures

7:30

and their willingness to talk about them.

7:32

And later I called that phenomenon psychological

7:35

safety. You. Said something

7:37

interesting Now you said. You.

7:39

Think I'm gonna tell you a

7:41

really embarrassing stories. And I

7:43

kinda did. Actually, I kind of did

7:46

think you were going is how me

7:48

a story that is certainly much more

7:50

embarrassing than that. I mean, I've had.

7:53

Sale Years in my life.

7:55

I was fired a couple

7:57

a times. I've. certainly

8:00

failed in relationships, I think

8:02

of my divorce as a

8:04

failure. I've had little mistakes,

8:06

you know, failures along the

8:08

way too. Why do we

8:11

find it so difficult to

8:14

reflect on, to own up to our

8:16

failures? I mean, I can't tell you

8:18

how long it took me to just

8:21

be able to say, yeah, divorce in

8:24

that way that I can

8:26

now talk about it. Yes, I think

8:29

relationship failures can

8:31

be painful, embarrassing. We get cultural

8:33

messages, and it's not just relationships,

8:36

it's career and work and

8:38

almost any setting you can think of, sports,

8:40

that we get cultural messages that say

8:43

success is what you want. And why is

8:46

it so devastating or so hard to admit failure?

8:48

I think it's because at a deep level

8:51

we worry very much about rejection.

8:54

So it's not just, you

8:56

know, embarrassing, it's terrifying, to

8:59

some level. There's a possibility that if you

9:01

really knew me, if you really saw

9:03

all my flaws, you

9:06

wouldn't like me anymore, you wouldn't want

9:08

me around, and I'd end

9:10

up friendless, penniless,

9:12

and destitute. And

9:15

the sad thing is, is we actually

9:17

like, our friends are people where

9:20

we know they have flaws, because

9:22

we acknowledge them to each other.

9:24

I think the difference between an

9:27

acquaintance and a friend happens

9:29

that moment when you start being

9:31

very real and

9:33

vulnerable about your worries, your

9:35

anxieties, your shortcomings, your failures.

9:38

So we have these wrong mental models that we have

9:40

to keep overcoming. And yet

9:42

we are very quick to jump on

9:44

the failures of others in a lot

9:47

of cases. We're really to point out

9:49

when other people have failed, and not

9:51

so quick, to reflect necessarily on our

9:54

own failure, which you call

9:57

Our failure to learn from failure.

10:00

Which I think is interesting. How do

10:02

we turn the corner on that? I

10:05

think it's educating ourselves. Or. It

10:07

educating ourselves to chess. Step

10:10

back and realize yes, You

10:12

are fallible human beings. Each and every one

10:14

of us is a fallible human. Beings. That's

10:16

the nature of being a human being.

10:19

And we also. Work

10:22

and live infallible systems. That so that

10:24

and I'm around every corner is a

10:26

potential for something to go wrong. That's

10:28

okay. And then we can. Always, we can do better.

10:31

And of course we can and must. Learn

10:33

from failures, our own and

10:35

others. But. I think

10:37

the real answer your question is

10:39

that we have these wrong. Headed.

10:42

Beliefs about. What

10:45

we should be. Like. And

10:47

what we should be doing. We should be

10:49

perfect. We should be without slaw. And.

10:53

That's just. Not

10:55

consistent. With. Reality. We.

10:57

Even now it makes me think of

10:59

the works it has been done in

11:02

and around. Women In Investing I run

11:04

in Investing Club for Women it's called

11:06

Investing Six I do with my friend

11:09

Karen Feinerman his a professional investor and

11:11

we teach investing to a few hundred

11:13

women every other. Monday night on Zoom.

11:16

In a lot of these women

11:18

are bitter, so brilliant. The Justice:

11:21

so smart They the questions that

11:23

they bring to our club are

11:25

amazing and yet they're not. Confident

11:27

investors, which is one reason I

11:30

think that they're they're. One

11:32

theory about why women shy away

11:34

from the risk involved with investing

11:36

as that we don't wanna sell.

11:38

We don't like to sail, we

11:40

like to know the answer to

11:42

every question before we ask. And

11:44

I know that's true of me.

11:46

So what do you think of

11:48

that a first us on our

11:50

risk aversion in investing and anything

11:52

else. Or there's an element of

11:54

it that is very healthy. We

11:57

actually don't. I don't want to advise

11:59

people to hey, Unnecessary.

12:02

Risk took. Part of the definition

12:04

of what I call an intelligent failure

12:06

is that it's as small as possible.

12:09

And it's just big enough to get.

12:11

The learning you need. To

12:13

make the next step. That might be

12:15

the next investment. So success in an

12:17

uncertain world depends on high quality bets.

12:20

Are. Doesn't depend on. A. Crystal Ball because those

12:22

don't. Exist but it does depend

12:24

on. Your ability to

12:26

formulate a reasonable. Hypothesis

12:29

about what might happen with

12:31

this investment or with this

12:33

project and. Part. Of

12:35

what makes it high quality is it's

12:38

not bigger than you can afford with

12:40

as as financially, reputation lee or some

12:42

a human safety perspective. That's very

12:44

interesting way to think about it.

12:47

In your book, you write about

12:49

three different distinct types and family.

12:51

Or can we talk about what

12:54

they are and how they're different?

12:56

Sure, and of the three types, I won't.

12:58

Have this preview. The only one of

13:01

them is good. Not an ethical moral

13:03

sense, but in a sort of useful

13:05

productive cents a celebratory sense to the

13:07

three kinds are basic. Complex.

13:10

And preventable. And the basic

13:12

failures are those on desired

13:14

results that are caused by

13:16

a single. Error. A

13:18

single single deviation from known practice.

13:21

They take place in familiar territory.

13:23

You know you accidentally put in

13:25

sugar instead of salt and the

13:28

recipe and it ruins it. Complex

13:30

failures are multi causal. There

13:32

are the kinds of failure to

13:34

happen when a handful. Of factors lined

13:36

up in just the wrong way. And

13:39

any one of them, they could be

13:41

deviations. You're doing something not quite right

13:43

to your little late for meetings. A

13:45

handful of things. Any one. Of which

13:47

on it's own would not have produced

13:49

a failure, but the fact that they

13:52

all came together creates a failure. In

13:55

healthcare delivery, for instance, this is

13:57

a breeding ground for complex still years

13:59

is. So much complexity that

14:02

sometimes his little deviations and

14:04

from very best practice all

14:06

come together. And. Lead

14:08

to say a drug overdose

14:11

happening at the bedside against

14:13

very much. Neither. Of those

14:15

are good, are both preventable. And

14:17

Nablus draw. A. Line in the sand

14:19

Because now we go to the third kind and

14:22

the third kind. Are. Genuinely good.

14:24

They're genuinely useful. I call

14:26

them intelligence failures and they

14:28

are a d still on

14:30

desired result of a novel

14:32

for a in new territory

14:34

and to be. Even

14:36

more sort of Christmas about it.

14:38

They are in pursuit of a

14:41

goal. Is. Genuinely new territory is

14:43

no known answer about how to get the

14:45

results you want. He's. Done Enough

14:47

thinking about. It to have good reason

14:49

to believe that might work. and. Finally, it's

14:51

no bigger than it has to be.

14:54

It's it's an experiment where you

14:56

don't waste resources. the risk you're

14:58

taking. This is big enough. To

15:01

get the new knowledge that you desperately need.

15:03

So I. Think I'd get

15:06

it sort of in terms of

15:08

how these month apply In like

15:10

right the basic sale year is

15:13

when I. Don't.

15:15

Close the door to my closet and my

15:18

dog eats a shill even though he's done

15:20

that many times, I know he's going to

15:22

and sell it's on. Me Says prevent idol

15:24

failed is preventable. I mean, we don't blame

15:26

you right away. We wanna know more about

15:29

what you were dealing with. sick cetera, et

15:31

cetera. But it's preventable and it's not

15:33

a happy outcome. Now and my husband

15:35

does blame me and he was out

15:37

there. Any license this is it is

15:40

you have to learn this is you

15:42

or in the complex in doesn't make

15:44

sense sort of in. That.

15:46

Medical setting Riotous. There's a shift change

15:48

and somebody new comes in and may

15:50

hang around. Lazy bag and they didn't

15:52

bother to check the chart and see

15:55

that somebody was on a different Madison

15:57

That got them all messed up. That's

15:59

a problem. The two names of

16:01

the patients are similar. the names of

16:03

the medications or similar. Again, any one

16:05

of those little. Sectors on it's own.

16:08

Wouldn't. Lead to a bad

16:10

outcome but. Several of them happening

16:12

together and. The failure

16:15

gets through could. Be really bad. We.

16:18

Are gonna take a quick break. Her

16:21

money is probably sponsored by Edelman

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Financial Engines. Health care costs are

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on the rise that we know that taking

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out ahead of unexpected health care and

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now have a plan that can work

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for you and your family no matter

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what. Mr As that you schedule.

16:47

Your complimentary wealth Set up

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to meet with an advisor

16:52

as planned he as he.com/for

16:54

money. And

16:58

we're back. The. In.

17:00

College in. Sale

17:03

year key. Give me an example.

17:05

Sure, I mean to bread. And

17:07

butter for a scientist is an intelligent

17:10

sillier. So it's I opened the chapter

17:12

on intelligence failures in the. Book.

17:14

With the story of Jennifer Hims drove who's

17:16

as a chemistry professor, the first woman to

17:18

get. Tenure in Chemistry at

17:20

Emory University and she describes an experiment

17:23

in her lab where they're trying to

17:25

get messenger are in a to separate

17:27

and they have a hypothesis that a

17:29

certain chemical might work. It doesn't work.

17:32

Then they think maybe salt will work.

17:34

They put the sultan that doesn't work

17:36

for itself. Both of those were failures.

17:38

Both of those sound like quick like

17:40

you're in the kitchens. not. It takes

17:43

a little time for both of those

17:45

involved, time and resources and yet. They

17:47

lead to disappointing results and knows

17:49

are in fact disappointing to the

17:52

scientists involved, but not devastating because

17:54

they've trained themselves to know that

17:56

if you want to be a

17:58

leading edge science. He will

18:01

be stirring thing failures on the

18:03

way to hopefully some stunning successes

18:05

Now in in an investment space,

18:07

all of us had investments that

18:09

didn't produce the results we had

18:11

hoped. And. If we're thoughtful.

18:13

You had good reason to believe it might be

18:16

a good investment, is done your homework on thinking

18:18

about the company or the market or what have

18:20

you and just. Turned out that

18:22

reality didn't cooperate. So that would be

18:24

an intelligence failure. Rate. And when

18:26

you think about it, Twenty

18:29

Twenty Two. Was kind

18:31

is in intelligence failure rate in

18:33

at least in the Bond market,

18:35

right things to didn't line up

18:37

like they were supposed to ends

18:39

and you couldn't have known in

18:42

advance. The right, and hopefully you

18:44

had enough time to sort of ride

18:46

it out. right? He didn't invest more

18:48

than you could afford to lose all

18:50

of this. Talk has made

18:52

me think a little bit about

18:55

Sandbanks been freed, right? The Golden

18:57

Boy The former golden Boy of

18:59

Crypt Sell. I need people. Some

19:01

people are scratching their heads depending

19:04

on at what round his testimony

19:06

your readings to try to figure

19:08

out of his failures were malicious

19:10

or if he was just trying

19:13

to do too many things at

19:15

once. right? Reading.

19:17

That the news coverage. It

19:19

does seem that. The more we

19:21

know, the more it seems

19:23

that some deception and fraud

19:26

were. Part. And parcel

19:28

of the company's at least for a

19:30

while, right? and they did not on

19:33

day one here. It's true, it's like

19:35

it's one thing for me to offer

19:37

definitions of the three times a failure,

19:40

but in most cases you do need

19:42

to do some thoughtful analysis to know

19:44

which type is this and sometimes it's

19:46

obvious that in other cases is you

19:49

need more information about the context and

19:51

the players and the intentions and so

19:53

forth to really diagnose. Clearly, this was

19:56

new territory of very novel. Territory

19:58

and clearly. There's a

20:00

guy has done his homework. Rates are check,

20:02

were sort of heading in the right direction

20:05

of intelligence failure but right. we started to

20:07

fall. He starts to fall off the path

20:09

those intelligence failure. as we learn more. The

20:12

other example I've been thinking of

20:14

is a woman named Catalan character

20:17

and Andrew Weissmann who basically we're

20:19

responsible for a lot of the

20:21

m are in a vaccine research

20:23

that led to able to have

20:26

the covered vaccine so quickly and

20:28

see his at my alma mater

20:30

at the University Pennsylvania where so

20:33

many years this has been written

20:35

about the just couldn't believe in

20:37

a research right They they just

20:40

state it, they believed her research.

20:42

Was a failure of sorts.

20:44

Ends flutter in a small

20:46

lab. Can is centered her

20:48

aside and sell P S.

20:50

This failed research saved a

20:52

whole lot of people and

20:54

won the Nobel prize and

20:56

I was taken by your

20:58

description that scientists are used

21:00

to family three inches. This

21:02

is sort of bills and

21:04

for scientists, but they're a

21:06

lot of people who are

21:08

afraid to take risks at

21:10

work because quote Unquote. Feelings

21:13

can cost them Their

21:15

jobs. Get any suggestions

21:17

for ways that we

21:19

can expand our ability

21:22

to try things with.

21:24

Out fear of being reprimanded are

21:26

fired will I think it starts

21:29

with situation awareness or sizing up

21:31

the context and in my thinking

21:33

context has to. Basic dimensions are

21:36

at one is what are the

21:38

steaks? Those can be financial stakes.

21:40

Are human safety steaks? sometimes

21:42

reputation states and the other

21:44

is. How much uncertainty

21:47

is there now? I love. To talk

21:49

about scientific labs because they're at the

21:51

high end of uncertainty and in there

21:53

they are literally deliberately choosing to play

21:55

around and the domain that nobody understands.

21:58

Yeah, so that we can under. And

22:00

it better so they because

22:02

they. Appreciate as the contacts

22:04

they've. Chosen they have to train themselves

22:07

to be less allergic to failure than

22:09

the average person. Then if you're running

22:11

a lab, you remind the young. People

22:13

who work for you that this is the

22:15

game were playing and it's okay. Jen he

22:17

sir says we're going to sail all day

22:19

parade an. Emphasis added the smiles when it

22:21

is is also a scientist and I asked

22:23

him once how many the experiments or what

22:25

percent of the experiments in your lab and

22:28

and failure and to his credit. He thought

22:30

about it. Is it really think about

22:32

seventy percent niceties? Yes. Then I realized

22:34

that wasn't very supportive response. A success.

22:37

I wanted to be right scores and

22:39

so close enough. But. The point is.

22:42

You won't be a good scientists if you

22:44

don't help your. Students

22:46

and postal employees to sort

22:48

of. Truly. Understand both

22:50

intellectually and emotionally that this is

22:52

the contexts now your average employees

22:55

in let's say a large financial

22:57

services from his neck and get

22:59

kudos. For some giant failure

23:01

in their jobs. But.

23:04

The bigger risk I would say

23:06

of sort of having people being

23:09

happy to sail indiscriminately. The bigger

23:11

risk is that things will. Go

23:13

wrong and you won't hear about it.

23:15

That's the bigger risk as we toxify

23:17

failure so much that people are than.

23:19

Unwilling to speak up with the small

23:21

signals, The something might be off

23:24

in time to catch incorrect and

23:26

then avoid the big failures cause

23:29

I'm a big fan of avoiding

23:31

big failures and so in Companies,

23:33

people and leaders. In. Particular want

23:35

to be very clear. About what

23:38

context, all companies include Many contacts.

23:40

You've got. Some are, indeed, we've

23:42

got some Some routine operations, but

23:44

be super clear about what's at

23:46

stake and what's the uncertainty. And

23:48

that. Spells, Out. How.

23:51

Much experimentation. We.

23:54

Are willing to engage in and

23:56

that can be very low. Because.

23:59

High stakes answer. The or can be very

24:01

hard because the future depends on it. While.

24:03

I'm There are a lot of investors who use

24:05

a paradigm that similar. They'll make a bet. And.

24:08

Is it drops by ten percent? Or

24:10

fifteen percent they get out to

24:12

get out. keep the last small

24:15

yeah to limit the losses. It

24:17

does seem in in some circumstances

24:19

that women have less license to

24:21

fail often and sanford when men

24:24

sales. They. Tend to brush

24:26

it off my skills on or

24:28

at least give that outward appearance.

24:31

When women sale it sticks with

24:33

them until. They prove

24:35

themselves. Otherwise

24:37

and. You

24:40

know, I think if if we looked

24:42

for examples of this, you know, female

24:44

Ceos totally out of you. Just so

24:46

yeah to Catalina. Next, I mean why

24:48

do we expect more of women Or

24:50

as women? Why do we expect more

24:52

of ourselves? For I was just in

24:54

the say I. Think there are two you

24:57

know to. Mutually

24:59

reinforcing sectors here, and one is

25:01

our own psychology, upbringing, socialization, and

25:03

then the other is the cultural

25:06

messaging around gender, and I think

25:08

women tend to internalize more of

25:10

the messaging that we have be

25:12

perfect for we. Have that with not

25:15

make mistakes as other. People are depending

25:17

on us in some way and

25:19

so there's A. There's a lot

25:22

of quiet messages that that we

25:24

internalize and they're from course, coming

25:26

from the broader cultural forces. I

25:29

do believe our our media and

25:31

our business contacts are far less

25:33

forgiving of women who. Experience.

25:36

Sale Years Opposed In the

25:38

kind of blameless with category

25:40

and in the blame worthy

25:42

a category, We vilify those

25:44

visible examples in a way

25:46

that. Is. Problematic I think in terms

25:48

of what really matters which is the. Future

25:51

was as allowing us to take. healthy

25:53

risks and to be honest about it and

25:55

the only solution i have which isn't much

25:57

of a solution but i think it's a

25:59

beginning is to make it discussable, which is

26:01

exactly what you're doing. I mean, I think

26:03

the more we talk about this aloud, the

26:06

more we reduce its

26:08

pernicious effects. When

26:11

you have a failure, and it's

26:13

a public or semi-public failure,

26:16

right? Public in your family, public in

26:18

your company, public in

26:20

the world, what's

26:22

the next right move? Is

26:25

it an apology? Is

26:27

it this is how we fix it? Is

26:29

it this is how we move forward? Or

26:32

is it just you full steam ahead? Well,

26:34

all of the above in a way, because

26:36

they're interrelated. So a good apology does take

26:40

accountability for your part

26:42

in a failure. You're rarely, but sometimes

26:45

100% responsible for

26:47

the failure, right? There's things you did that

26:49

contributed. There's things you didn't do that contributed.

26:51

And the courage to own

26:53

those and own up to them and

26:55

label them is sort of part of

26:58

a good apology. Another part of a

27:00

good apology is making amends where

27:02

you can. Either I promised to do this

27:04

differently next time or the things you can

27:06

do to help out with someone who has

27:08

been harmed by your action, one

27:10

does them. And they're good examples

27:12

of this, both in personal life and in

27:15

corporate life of CEOs and others doing

27:17

the good apology that both owns

27:20

up to the shortcomings and

27:22

helps make amends to the customers

27:24

or whoever were harmed. But

27:27

probably even before you can apologize,

27:29

especially a public apology, comes the

27:32

step of learning as

27:34

much as possible about the simple

27:36

question, what happened? You know,

27:38

it's not don't jump to conclusions. I

27:40

screwed up. Let's just ask

27:42

the clean, clear question, what happened?

27:45

So that we can fully understand it,

27:49

primarily for the goal of never

27:51

having that exact one happen a

27:53

second time. And then, yes, move on.

27:56

But I think moving on without doing some of

27:58

the important work of learning. You

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a high-yield savings account. I'm

30:00

good, I just got my eyebrows done. That's

30:02

why you're staring at yourself in the zoo. Yeah,

30:05

I'm checking myself out. You

30:09

guys can't see my daughter, but she's sitting

30:11

there and she's raising one eyebrow and the

30:13

other is raising the other eyebrow and they

30:15

do look good. Did

30:17

it hurt? No, I went

30:20

to this lady, Monana, that my

30:22

camp friends all go to. Do

30:24

you remember the Friends episode where

30:26

Monica's identity was stolen and

30:28

the woman who stole her identity was

30:30

pretending to be Monica Geller and so

30:32

Monica told her that her name was

30:34

Monana? No, I don't, but that's

30:36

hysterical. You'll have to go back and watch

30:38

it, although these days I gotta say I still can't

30:40

watch Friends without being sad. I

30:43

know. Let's take some questions.

30:46

Alright, our first question

30:48

today comes to us from Ashlyn.

30:51

She writes, I

31:22

only use them for budgeted recurring expenses and paid in

31:24

full at the end of the month, but

31:33

now I've maxed out the credit cards and it will

31:35

take three months of aggressive repayment to pay

31:38

them off. And then my son

31:40

was in the hospital last week for an

31:42

asthma attack. It just keeps coming and coming

31:44

and now I'm putting off medical procedures to

31:46

the detriment of my quality of life and

31:49

pause the reskilling necessary to

31:51

change careers. My wife

31:54

is unable to work due to a mixture

31:56

of disability and caring for our two special

31:58

needs children, so it all follows. on me.

32:01

I've always been taught that paying off high

32:03

interest debt should be the number one priority.

32:06

But I've been wondering if maybe it would

32:08

be a better idea to just make the

32:10

minimum payments for a while with the 30%

32:12

interest and try to actually build up some

32:14

cash savings. Would that help? And if not,

32:17

what can I do to get out of

32:19

this cycle? Oh

32:21

boy. Ashlyn, first of all, just

32:24

take a breath. I mean, this

32:26

is a lot. It's a lot that has

32:28

happened to you in a very short period

32:30

of time. And I think it's

32:32

particularly hard when you've gone through

32:35

the process of taking the steps

32:37

to write your ship. You

32:39

were doing the right things. You

32:41

built up an emergency cushion and then you

32:43

get hit again and again. And sometimes life

32:46

just happens. But because you've done

32:48

this before, you know that you can

32:51

do it again. And so

32:53

here's the way that I would

32:55

approach it. I think you do

32:58

want to try to do a little bit

33:00

of a mix of

33:02

saving with some

33:05

perhaps not quite so aggressive

33:08

debt repayment. But what I

33:10

don't want you to do

33:13

is make minimum payments. Minimum payments

33:15

are a trap. They'll keep you

33:17

in debt for years. So you're

33:20

looking for something where perhaps you

33:22

can split the difference a

33:25

little bit. And then I want

33:27

you to go and find yourself

33:30

a credit union. I don't

33:32

know if you have a credit union

33:34

at work. I don't know if you

33:36

have a local credit union. But

33:41

look for a credit union where you

33:43

can actually go in and

33:45

talk to somebody there about whatever's

33:47

going on in your life and

33:50

see if perhaps you

33:52

can refinance the debt on

33:54

this credit card down to

33:56

a lower interest rate that

33:58

will just enable you. you to

34:00

pay it off a little bit easier.

34:02

I don't think that you're going

34:04

to be able to get a very

34:06

low bottom of the barrel teaser rate.

34:08

I'm hoping that maybe if you talk

34:10

to somebody and they've got a

34:13

program in place, you could get

34:15

an interest rate of 9, 10, 11%, something like

34:18

that. Either way, try

34:21

to do a little bit of both. Try

34:23

to track how long it's going to

34:25

take you to reach your goal, which I know

34:27

you're capable of doing because you told me that

34:29

it would take three months of aggressive debt repayment.

34:32

Then when you do start stashing

34:34

money away in that emergency cushion,

34:36

you want to aim for a

34:39

full six months worth of expenses

34:41

for emergencies because you are the

34:43

only wage earner in your household.

34:46

When we've got two wage earners, we

34:48

can sometimes have a smaller

34:50

emergency cushion because if one partner falls on

34:52

hard times, we know that the other one

34:54

has the ability to bail us out.

34:57

In a case like yours, it just needs

34:59

to be bigger. It'll happen. I

35:01

know it will. I've got a lot of faith

35:04

in you and I wish you

35:06

all the luck in the world. So keep going.

35:09

Keep going. You got it. All right.

35:12

Next question. Next question.

35:14

Our next question comes to us from

35:16

Megan. She writes, Hi, Jean

35:19

and team. Thanks for answering my question.

35:21

I always love your perspective on

35:23

complicated mini situations and how you

35:25

approach things with kindness and grace.

35:29

Here's my conundrum. My

35:31

mom loves to buy gifts. It's

35:33

her love language. She always gets me

35:35

several things for the holidays. However,

35:37

this year I asked her not

35:40

to. I don't really need more

35:42

stuff because I have everything I need and

35:44

a pretty small house. Instead, I

35:47

asked if she could forgive part of a

35:49

loan I owe her. She flat out refused

35:51

because she said that's boring and she wants

35:53

to buy the gifts. So

35:56

I'm not sure what to do. Any thoughts?

35:59

Should I just accept? that my mom is going

36:01

to buy me stuff I don't need once a

36:03

year and move on. Was there another approach I

36:05

could have made? Thanks for your help." Oh,

36:08

I really wish your mom

36:11

was willing to listen to you. And clearly,

36:13

she is thinking a lot more about

36:15

what makes her happy than what

36:17

would make you happy. And

36:20

we know, because there is a

36:22

lot of research on what's called

36:25

pro-social spending, that when we do

36:27

things that are really in service

36:29

of other people, those

36:31

are the things that make us as

36:33

the giver happier. So she

36:36

hasn't learned that lesson. That

36:38

is not something that you're going to be

36:40

able to teach her. Boy,

36:42

part of me wants to say, I hope

36:45

these gifts are of value. Take

36:47

the gifts, flip them or

36:49

re-gift them, save yourself some money

36:52

and use that money to

36:55

repay the loans

36:57

that you have outstanding and the money that

36:59

you owe your mom. I mean, I think

37:02

that might be terrible. I was going to say,

37:04

I mean, mine's terrible too, but ask her for

37:06

gifts from a department store, a

37:08

store that sort of has everything that you

37:10

can get multiple things for. So if

37:13

she gets you something for the home, you

37:15

can return it. And I

37:17

don't know if Megan has

37:20

kids, but get pajamas for your kids or your

37:22

nieces or your nephews, hold on to that gift

37:24

card for when you need a new pair of jeans and

37:26

then you're not spending money at all. I don't know. That's

37:28

a tough one. No, I think that makes

37:31

sense. It reminds me of what I've

37:33

heard about bridal registries. On

37:35

zola.com, good thing for any

37:37

up and coming brides, grooms,

37:40

to know, to know. Is

37:43

that on zola.com, let's say, this is like an

37:45

ad, shout out to Zola, okay? If

37:47

you register on Zola, let's

37:49

say you do like Crate and Barrel,

37:51

Bloomingdale's, whatever, all our family friends are

37:53

going on, they're picking out the gifts.

37:57

Oh, Jean Chatsky has decided to get me the

37:59

gift card. Cuisinart from my registry.

38:02

Turns. Out Jean Chatzky doesn't know.

38:04

The Irish have the Cuisinarts to.

38:06

Zola sends you notifications and they're

38:08

like t want to accept the

38:10

guest or. Do just one the cash

38:12

value of the guests jean. Chatzky never

38:14

know is that I don't get that

38:16

guess he just thinks like to change

38:18

too late getting her cleaner and then

38:20

I know Jean Chatzky think she got

38:23

me a cuisinarts. They can thank Steer

38:25

Gene think you so much for the

38:27

cuisinarts. but really I just got the

38:29

past value of it's. Brilliant.

38:31

The wrinkle is if what you really

38:33

want is the class because the right

38:35

near a lot of people i think

38:37

my age who would rather buy an

38:39

actual guess then give cash. Sweet! We

38:41

feel like buying a disc is more

38:43

meaningful are more special for whatever reason

38:45

and a lot of cases. But if

38:47

you register for things that you already

38:49

have when I come to your apartment

38:51

and I see the cuisinarts I don't

38:53

know that it's not the cuisinart that

38:55

I got you. Rights and Sell.

38:57

Then you're not caught out because

39:00

the big problem was somebody sends

39:02

you a vase rates. You have

39:04

to put that out when they

39:06

come to this. the U. Cel.

39:08

unless you're planning on never inviting

39:11

these people tier apartments. you gotta

39:13

be a little crafty may be

39:15

Meghan is you play some sort

39:18

of they have version of that

39:20

and. You. Use the

39:22

you use the money to

39:24

help you. In other ways in

39:26

your life. Thank. You

39:28

Julia, thanks for having me. If you

39:30

have any other money related questions we'd

39:32

love to hear from you, just send

39:34

them to us by emailing mail bag

39:37

at her money.com. And

39:39

now we're gonna take a quick break. This

39:43

episode is brought to you by Carnegie

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