Her father’s advice wasn’t the only great money management tip she received early on. In college, a finance professor did two entire classes on personal finance, sharing the benefits of starting early to save for retirement.
Her financial independence journey was kickstarted when her apartment burned down—and she had no renters insurance. She thought to herself, “I don’t want more stuff. I just want to figure out the life I want to lead.”
Aditi and her husband took a roadtrip to discover where they wanted to live and ended up in two separate cities, visiting on the weekends. Time apart made them realize they wanted to be together, so she moved to him and started the life she truly wanted.
Mindy: Aditi Shekar from Zeta App, welcome to the Bigger Pockets Money podcast. How’s it going today?
Aditi: It’s going amazing. We have beautiful weather in San Francisco this morning.
Mindy: Oh, well nice. It’s not cold.
Aditi: It’s not cold. It’s sunny, it’s bright, it’s lovely. It’s a rarity sometimes in San Francisco.
Mindy: Yeah. So I used to live near San Francisco and we would go to San Francisco. I’m sure you know this thing, the coldest winter I ever spent was the summer in San Francisco.
Mindy: It’s such a stupid thing. If you’re in San Francisco you’re like, I’m so sick of hearing that. But it’s so true.
Aditi: It’s so true.
Mindy: As soon as you go over the bridge you’re like, why is it 45 degrees here? So I’m very pleased that you have delightful weather today.
Aditi: We do. And if you take a day trip out of San Francisco you better plan accordingly because it slaps you in the face.
Mindy: Yeah, it’s like 1,000 degrees just over the border. Okay, so weather aside, we want to know about your money journey. Where does your story with money begin?
Aditi: Yeah. So I actually grew up all over the world. My mom worked for the UN so when I was very young I was living in a small neighborhood in New Delhi, India. My story actually begins when I was about five years old and I really wanted to buy a toy and my parents said, “No way. You can’t have this thing because you bought enough this month. So if you want it you need to go figure out how to earn money,” which was an interesting thing to hear from your parents at age five.
Aditi: So I had my best friend who was conveniently named [Abita 00:01:59] which is the male version of my name, and him and I started a paper plane flying contest where we went and sold tickets to all of our neighbors and our friends to come fly their paper planes to get our contest. We learned about entrepreneurship and how to start a business at that age. It was such an interesting moment for me personally because there were three things we did.
Aditi: The first was we tried to rig the paper plane flying contest to win and learned about business ethics in the very early days of our entrepreneurial journey. The second thing was we actually learned about how do you create tickets and make sure that no one can copy your tickets and bring them to the paper plane flying contest? So my dad taught us about why don’t you use a gold marker to hand sign each ticket so it’s very unique and interesting?
Aditi: The third thing we did was we actually took everything we owned that we didn’t want anymore, all of the toys, and made them the prizes for the paper plane flying contest. We made a ton of money as a bunch of little kids and ended up going and buying all these new toys with that money.
Scott: That’s awesome.
Mindy: That’s fantastic that you have the insight at age five. Or not insight, the-
Mindy: The get up and go. What is the word I’m looking for?
Mindy: The hustle at age five. Most five year olds get told no, they’re like okay fine and they go do something else.
Aditi: But it was because my parents said, “No but if you want it, you got to go earn it.” That was incredibly empowering because to a little kid to hear that I’m like, oh I can go do this. Oh, okay, you’re going to help me do it. My parents actually sat me down and walked me through. My mom was like, “Okay where are you going to put the money? Let’s get you a box to put it in.” My dad was like, “How do we set these tickets up in a way that people can’t replicate it?”
Aditi: So they made me think about all of these dynamics. When I launched my first business, it was profitable and it was incredibly empowering because I’d learned how to do it in a matter of weeks.
Scott: Did you win the contest? Did you rig it successfully?
Aditi: No. It wasn’t even close. That’s how bad it was and the reason we picked a paper plane flying contest is we just had gotten back from the US, actually a trip to California. And we were like, oh we have this fancy paper plane tool that we had built. We were like, let’s use this fancy paper plane in our contest. It didn’t even come close. There was another kid in our neighborhood who took all of our toys.
Scott: That’s awesome. How did this translate into kind of middle, high school and beyond?
Aditi: Yeah. I think because I did that so early on in my journey, as the years went on and every time I hit a road block where I wanted money and I couldn’t get it, I would just go start a business. So in high school again I had watched all these American movies. I was living in Tanzania at the time, which is in the middle of nowhere in East Africa.
Aditi: I really wanted to go to prom. I was like, mom all these movies have these like awesome proms that people go to but we don’t have a thing like that. My mom was like, “Well, what’s stopping you?” So we build our first prom and we earned $3,000, my best friend and I, which felt like a lot of money to have in high school. So we definitely blew that money. We’ll talk more about that later. But it just kept coming up over and over again in my life.
Aditi: So I think over the span of my sort of career as I moved into college and beyond, I really thought wow I’ve been doing this since I was a kid. What if I were to do this professionally? What would that look like? And here we are. I’ve built Zeta and it’s a total repeat of that experience.
Scott: So what was your discipline around spending the money that you earned? What was your philosophy, your learnings from that, around that?
Aditi: Phenomenal amount of discipline, which was I had none. I would earn the money and then I would immediately go blow the money on the toy I wanted to buy or the thing I wanted to go to. I think that discipline really came more with age quite honestly. It was when I had gradated college and was working and realizing how much effort it took to earn that money and actually paying for your own expenses. It’s like a real epiphany moment.
Aditi: Whereas in the past every time I earned money through these businesses, most of my expenses were covered so it was always a slush fund. It was always something I could go blow. Whereas when I started earning a salary was when I realized wait a second, maybe you can’t blow all of the money and you need to be a lot more thoughtful about it.
Scott: So what did that look like when you started to earn your first salary? What shifted? Why’d you decide to go earn a salary rather than just start businesses?
Aditi: It’s a great question. I think I thought it was the right thing to do, was to go get a job. My parents had definitely encouraged us to go be entrepreneurs but they’re very Indian and they were like, “Oh yeah of course you’re going to go get a job.” So that felt like the right path forward. I remember the first job out of college was actually in San Francisco at a nonprofit called Donor Shoes. I earned $30,000, so it was not a lot of money to be earning in San Francisco even back then. And I started looking for an apartment to live in and I couldn’t afford a single apartment on my salary.
Aditi: I looked all over the city and every one I looked at I was like, this is really miserable. I don’t want to live like this. I was lucky enough that we had family living in San Francisco and I said, hey guys can I live with you and try to save money on rent? The second that that happened, that they were okay with me doing that, I ended up realizing that I have this money coming in every month. I didn’t have the big rent expense but I had all these other expenses. Commute, parking, dealing with food costs and travel because my significant other was not living with me in San Francisco at the time.
Aditi: So it forced me into a state where I had to really think very intentionally about the little salary I was earning and how I was actually spending that money. I had a lot of things that I wanted to do still. I wanted to go see my boyfriend. I wanted to go have great experiences now that I was earning this salary and I needed to make sure that it was very affordable for me the whole time. Stepping back from all this, I will say I joke that I’m good at money because I’m Indian. It’s like culturally it’s ingrained in you from a young age where your parents are just like, hey you got to understand finances. So it was never even a thought in my mind that credit was an option, that going into debt was something that you could do if you wanted to afford a certain lifestyle. It was always the idea that you had to live within your means. So that discipline came at that very important moment where I got my first job and had to make it happen.
Mindy: Okay. So you say you’re good with money. What does that mean? You didn’t have any credit. You paid cash for everything?
Aditi: I put everything on a credit card that I paid off immediately. We didn’t have the concept of credit growing up in all these other countries or having to earn a credit basically or credit history. So when I got to the US and tried to go get a cell phone in college, I was in Chapel Hill, North Carolina and I go to get a cell phone and they said, “No we don’t even know who you are. We’re not going to give you a cell phone. You need to pay us a $500 deposit for us to give you a cell phone.”
Aditi: For a college kid who has like $2,000 in a year, it was like what? You want to take a fourth of my money? So I started trying to learn about how to build credit. As you guys well know, the credit building systems in this place are really weird. You have to get debt to build credit. You have to have a credit card to build credit. I would get rejection letter after rejection letter from all these credit card companies who would not give me a credit card because they were just like, we don’t know who you are. You’re a flight risk, is what the actually stated in the letter.
Aditi: Yeah, Citibank actually said that to me. But Amex. Amex, thank you Amex, I don’t know why, gave me a $800 Student Blue credit card. That was the first opportunity for me to start building credit and really starting to learn that, oh you know what, this is something that I’ll have to do so that I can actually get a credit card and then spend the money on that card and earn points and so forth.
Mindy: So were you saving any money when you were making $30,000 a year living in San Francisco?
Aditi: Yeah. One of the best things that happened to me, I actually wrote him an email a year ago, we had a college professor at UNC Chapel Hill. I went to business school as an undergrad. And he was a finance professor. He sat us down one day in finance class and he was like, “Guys, today we’re not going to talk about corporate finance. Today we’re actually going to talk about personal finance.” And he did an entire two classes on personal finance.
Aditi: He gave us very, very sort of rough rules of thumb. The thing he said to us in particular in that conversation was, he said, “You have to start early with retirement.” He showed us all the charts of starting early with retirement. He said, “Every single one of you sitting in the room today,” there were about 50 of us in the class, he said, “You need to commit to me that you’re going to put $100 from every paycheck into a retirement account.”
Aditi: It was just a very random number, $100. But he just made us make that commitment. So the first job out of college, it just stuck with me. I was like, I have to put $100 out of every paycheck into a retirement account. And because I was lucky enough not to be paying rent, I took anything else I earned and put it into savings. I had a rough goal for myself to try to save about $1,000 a month, which was pretty much where I landed every single time.
Aditi: So my first year of having a job, I had saved $12,000.
Mindy: In San Francisco making $30,000 a year? Wow.
Aditi: I was like, cheap. Let me be really honest. I was living the frugal life but it was awesome. It was one of the best feelings ever because it was such good discipline that every single job I got after that and as my salaries increased over time I just kept with that. I said, oh I have to save at least $1,000. And then if I got more money I was like, oh let me try to push that. So I would do the same thing with my retirement savings and the same thing with my salary.
Scott: When you use the word savings, do you mean that you’re putting that into a bank account in a savings account or do you mean that you’re investing that? Has that evolved at all?
Aditi: Yeah. So back then it meant I just put it in a bank account because that’s what I really knew. I didn’t really get savvy about investing until much later in my own career because I had focused so much on, oh I just need to have money in case I need it. So I would put it in a bank account and I remember I would send the bank account statements to my mom. Because like, mom look I have so much money in my bank account, and I was so proud of myself.
Aditi: Over time I learned that that was maybe not always the right thing to be doing because even when I was putting it into a 401K or a retirement account, one of the challenges I had is I couldn’t access a 401K. I wasn’t a US citizen, I wasn’t a green card holder. So I actually couldn’t sign up for any of those accounts. So I had to go force myself to go do the research of signing up. What kind of retirement account can I sign up for? How do I sign up for it?
Aditi: I came across a company called ING, which no longer exists in the US. They were bought out by Capital One but I opened up my first Roth IRA at ING Direct. That was the moment that I started investing so to speak.
Scott: So if someone was in your shoes today, what would be the equivalent mechanism that they could go through to do that? Do you know that off the top of your head?
Aditi: To go do the research you mean?
Scott: Yeah, to go set up a retirement account if they’re not a citizen or are trying to solve those types of issues?
Aditi: Yeah. The good news is that all the big institutions support a Roth IRA. I just didn’t even know that it was a kind of account that existed. Everyone always just talked about the 401K. So all of the major institutions offer it. The Rouge Advisors offer it, [inaudible 00:14:20] both offer it, [inaudible 00:14:22] offers it. So you can really sign up for it anywhere but for most of our international students, they didn’t realize that that was an option until later on.
Scott: Got it.
Mindy: I didn’t realize that was not an option. So a traditional 401K you have to be a US citizen for. What about a traditional IRA? Do you know if you have to be a US citizen for that too?
Aditi: I don’t think you have to be but I wasn’t savvy enough about this stuff. I didn’t understand that stuff so I had just gone and done the research. Then when I looked at the traditional IRA and the Roth, the thing I liked about the Roth, and this will tell you a little bit about my personality, is one of the big questions to ask yourself when you’re opening a retirement account is do you think you’re going to earn more money today or do you think you’re going to earn more money when you’re retired?
Aditi: I was like, oh I’m going to be a multimillionaire when I retire. So the plan is to open up the account right now so that I pay the taxes now and just get to coast on all of the compounding interest. So it sounds like a really silly way to make a decision but that was really how I made my decision was I said, I’m going to open a Roth because it makes the most sense for me given where I’m at in my personality.
Mindy: That isn’t a silly way to make a decision. That’s a very savvy and intelligent forward thinking … I’m at a loss for words.
Aditi: It’s funny because I made my husband go through the exact same exercise and he was just like, “But how do you know that you’re going to be rich when you’re retired?” And I was like, that is such a stupid question. I just know.
Scott: Because you’re into Bigger Pockets Money.
Aditi: Yes, exactly.
Mindy: Why would I want to retire poor when I could retire rich?
Aditi: I was like, because I’m going to do a lot of things throughout my life and make a lot of money. And he was like, “Okay.”
Scott: So how did this mentality scale? Did your income change? Did your circumstances change and how did your investing and application of that spread between your income and expenses change over time?
Aditi: Yeah. I was crazy, I’ll be honest. So when I was young and I was working in nonprofit, I didn’t realize that $30,000 wasn’t a lot of money. To me it was a lot. I was like, wow from zero to 30, I’ll call it a win. But as I went and started working in other institutions, I was lucky enough that I was getting a lot of new opportunities. So my job was constantly changing.
Aditi: I got promoted an obscene number of times in the first 10 years of my career. Can you tell I’m like a type A crazy person? When that happened, my salary increased. So between the first year that I started working and the couple years down, my salary was tripled, quadruple of what I was earning at Donor Shoes. So as those things happened, one of the things that I realized I was doing very naturally but later found out the terms for was I never really allowed lifestyle creep to happen. So every time my salary increased I would go in and I would say, okay at this salary I was saving $1,000 so if I double my salary I should try to be saving 2,000.
Aditi: It didn’t always happen. It wasn’t always that clean for me but it was very clear. There was sort of a basis that it was a baseline that I was going off of and building on every single year as my numbers got bigger. There were definitely some years, I remember I was about five years into my career and I decided that I was going to buy a car. I was so proud of myself because I walked into a BMW dealership mind you. Like not a Toyota. I walk into a BMW dealership and I negotiated for a brand new 2011 BMW and I paid for it in all cash. I was so proud of myself because I had saved all this money over all these years.
Aditi: I didn’t really have very concrete goals beyond buying a car or doing other things. I hadn’t really thought that far ahead. So to me the next big thing to do was to go do a big purchase. When I paid for that car, I was so incredibly proud of myself and I was like, I put all my money down. This is money I earned that I have spent years collecting. Then I drove the car off the lot and realized that my car depreciated quite significantly in that 30 second drive and suddenly had this sinking feeling like oh shit what have I done?
Scott: So that moment, what percentage of your savings was that?
Aditi: I don’t remember the exact percentage but it was a significant amount. Like I would say at least 30% or above.
Scott: Okay, got it. This sounds like a turning point in your philosophy with money. Is that what I’m gathering here? What changed about your philosophy and approach to money after you realized that you just lost 20% of your car’s value?
Aditi: Yeah. So I went and did a ton of research of how do you maintain car value if you buy at full price and basically came across that whole Warren Buffet, Charlie Munger thinking that you’re just basically going to drive that car for life. So guess what? The car is parked right outside and we still own it and we still drive it and we will continue to do so forever. But what I realized in that moment, it was sort of an interesting phase, was I was incredibly proud of myself and felt very accomplished because I bought something that was expensive and that had a status symbol attached to it.
Aditi: But very pragmatically it was not actually helping me. I think that was a sort of eye opening experience for me personally because I was like, wait a second. I don’t want to spend my money on nice things. I want to spend my money on making more money. So that was a moment of shifting my thinking of not really necessarily trying to go buy stuff but rather giving myself an opportunity to use any money that I ever earned or saved or invested to actually help me grow my wealth.
Aditi: I think shifting that mentality started shifting so many behaviors in my life. I cut back a lot of the sort of silly things. I would happily spend a few hundred dollars on shopping or food or whatever it may be but I’ve really reassessed a lot of those things. Now today my husband jokes that his shopping budget is much larger than mine.
Scott: So with regards to your portfolio, I’m gathering that over those 10 years … You’re 10 ish around when you bought this car, right?
Aditi: Yep, yep.
Scott: Your portfolio, I’m envisioning, looks like $100 a month very consistently plus a little extra and your retirement account’s invested somehow, and then a huge pile of cash in a savings account.
Aditi: Yep, yep.
Scott: Is that right?
Aditi: That’s exactly right.
Scott: So how does that change?
Aditi: When I stopped thinking about buying cars I actually started thinking about investing. So I started looking at the stock market. My first realization of the stock market was it’s like legal gambling is the way I describe it. I actually love that because I love to gamble. I’m like, oh this is fun. I think I could in another life be a gambling addict. So when I started getting involved in the stock market I was like, okay well how will I invest my money?
Aditi: Again, I created a very out of thin air rule of thumb that every New Year’s I would go and take $1,000 out of my savings and put it in the market. I started doing that around the same time that I was thinking about buying a car. I would pick stocks based on complete common sense. I would say, oh what are the things I like to use and the companies I think that are doing interesting things? I was committed to buying a Starbucks coffee every single morning. I am that girl and I have no shame about it. So I put money in Starbucks.
Aditi: So I went through this entire thing and I bought 10 stocks for $1,000 that first year. Then every year I increased that number because I got more and more comfortable with it. Then as the months went on, sometimes I would do it twice a year. Then I would do it three times a year. So at this point the majority of my cash is actually in the market. It’s not in cash. I really baby stepped my way into it rather than plunging in. Retirement to me didn’t feel like an investment. It just felt like a savings account. So in some ways even though I was technically investing my retirement, I didn’t feel that way.
Scott: This is so fun. So you went ahead and bought 10 stocks. It doesn’t sound like this was based on a tremendous amount of theorized research-
Scott: … and index funds and all that kind of stuff. But you bought 10 stocks. You were like, I want to put it all on one and I’m going to do it on 10 things that are practical common sense to me. And you created, I’m going to coin this term, the Aditi index that you continued to purchase over the years.
Scott: That’s awesome.
Aditi: You know what’s actually interesting? I remember getting interested in investing and I was like, oh let me email my family. I was like, hey guys I’m thinking about starting to invest. Where do you think I should invest? A couple wrote me back and was like, “I have no idea.” And a couple wrote me back and said, “Index stocks.” I was like, well that just sounds boring. That was my reaction.
Mindy: It is.
Aditi: Exactly. It is, right? You’re like, eh. But as a person who enjoys learning about money, to me I was like, hm this is not fun. This is not utilizing all of my talents. So I was like, I want to go learn about how to actually get into the market. I want actual stock. I remember a friend of mine had been given Wrigley’s stock by her grandparents when she was born or something and they would send her a packet of Wrigley’s every year as like, I don’t know, it’s like a weird thing that they do. I was just like, hey I want that. I want somebody to send me a packet of Wrigley’s.
Mindy: Wait, Wrigley’s or her grandparents would send? Wrigley’s sent a pack of gum?
Aditi: No, no, no, no. Wrigley’s sent her a pack of gum. It was like a weird, bizarre thing that they did. I was just like, I want that thing to happen to me. So that was the moment when I was like, I want to go start buying stocks. Forget index stocks. I’m going to go buy stocks.
Aditi: I will say, I was, I don’t know how, but obscenely lucky that my stocks outperformed the index stocks. So in hindsight it was probably not a bad decision but most people, one, would not have the interest to go identify which stocks they want to invest in, and two, really try to maintain those year on year. So it was a total personal dynamic but it actually ended up working out for me over the long run.
Mindy: Okay. So what year was this that you first threw your $1,000 into the ring?
Aditi: Oh man, you guys are really testing my memory.
Mindy: This was after your car, which was a brand new ’11 so like ’12 or ’13?
Aditi: I want to say probably, yeah, in 2012. Some time around then.
Mindy: Okay. So that was when the stock market had hit a complete bottom and then started its hockey stick meteor rise.
Aditi: That’s right.
Mindy: But the only reason it went so well is because you were finally investing, so thank you, as an investor who was invested at that time. Thank you for changing the turn of the markets with your brilliant stock picking. I want to know what stocks you were invested in besides Starbucks. Do you remember any of them?
Aditi: Yeah. So I bought Coca-Cola. I was like, everyone drinks Coca-Cola so you buy Coca-Cola.
Mindy: Warren buys Coca-Cola.
Aditi: Yeah. Yeah, exactly. He drinks it, it’s crazy, every day. But you’re absolutely right. The stock market had tanked so I was like, oh good moment to jump in as well. So I bought a bunch of banking stocks. I bought Citi and Bank of America when they were like not worth nothing. Funnily enough, a few years after that, Facebook IPOed. If you remember, Facebook’s IPO went through a really shitty moment.
Aditi: And I bought Facebook stock. I think I put the most amount of my money in Facebook. Honestly, like $3,000 in Facebook at $20. So that really skyrocketed for me. Today Facebook is about I think 180, 190 right now.
Mindy: Do you still have Facebook?
Aditi: Yeah. But I actually want to sell my Facebook stock. We’ll talk more about that later. So those were the kinds of things, like how I was making some of those decisions. The other thing that I was totally shocked about was when I tried to talk to my friends about it. I was like, oh what stocks are you buying? They would clam up. They would freak out. They would stop talking and they were just like, “Why are you asking me these questions? Don’t talk to me about this stuff. I don’t know what you’re talking about.”
Aditi: So that was when I realized like even trying to talk about money was actually way more taboo than I realized.
Scott: During this period of 2011 ish, 2012 when you started buying these stocks, what was happening with your career? Was it continuing to just, hey you’re chugging along in that sounded like triple, quadruple your 30K-
Scott: … conjecturing 100 to 120 ish? You’re just continuing to save more and get promoted?
Aditi: Exactly right. So originally I started saving and I even started getting really interested in real estate and bought a house, an apartment I should say, in DC. I was really excited about my apartment because I could rent it for more than the mortgage cost. So that allowed me to start actually earning more income and I would call it passive income at that point because I was just getting this nice, lovely check every month that I got to do more things with.
Aditi: I was actually working at education technology startup in New York and one of the things that kept happening was again, I was that Indian girl who’s talking about my budget and passive income and people started approaching me and saying, “Hey you’re always talking about money. Can you talk to us about money?” So I actually started teaching a class on personal finance.
Mindy: [crosstalk 00:28:46].
Aditi: Yeah. As a part of teaching that class, I started doing a lot of research into alternative investment options. So I looked at peer to peer lending. I still have investments in Lending Club that I can’t get out. I looked at the stock market. I looked at real estate. I looked at index and mutual funds.
Aditi: So that was the moment where I started to get a lot more sophisticated about what I was doing with that money. But the thing that I just kept coming back to was real estate because my dad has always been really big on real estate and always taught us since we were little kids that whenever you have money go buy land because land is going to be valuable. It’s worked really well for him in his life up to a point, until he needs liquidity and then it was a moment of struggle for him as well. But it taught me a lot about how to think about real estate.
Aditi: So at a very young age I was able to start to say, okay well what if I were to go buy a house? What would that look like? How do I think about the mortgage versus the rent that I could get from the house versus the expenses of the house? So I got really savvy about that stuff very quickly. At the same time, this is sort of a sad story, but our apartment in Brooklyn burnt down. With were living in New York and one night in the middle of the night, 3:00 AM in the morning, we woke up and the apartment was covered in smoke. We ran out and the cops were out there. They were like, “Get out, get out, get out.”
Aditi: Our building went up in flames. I learned a lot about what happens when the thing that you never expected to happen to you would happen. And how do you deal with that and how do you recover from that? And we did not have renter’s insurance. So that was another really important moment for me because right before that I was investing and savings and being really smart with my money. But the thing that I never really protected myself for, nor my husband, was neither of us had really thought about what happens in a moment of crisis and how do we make sure that we protect ourselves from it and we have the right kind of coverage to protect ourselves from it.
Aditi: So I was incredibly lucky because my family. My employer really rallied around me. I will tell you, when an employer rallies around you in a tough moment, it is an incredible way to build loyalty and commitment to a company. It was a very sort of eye opening experience for us because we realized how quickly everything that we had that we worked so hard to put together … I had bought every single piece of that apartment so thoughtfully and carefully, was completely shattered and crumbled and destroyed.
Scott: What year was this?
Aditi: That was 2014.
Scott: 2014, okay.
Scott: I’m trying to think about your wholistic financial position, how that’s contributing to this moment because this is obviously more than finance. What I gathered from the past 10 years of the story prior leading up to this is that you had a large cash position and were slowly increasing your allocation to stocks from an asset basis.
Scott: Did you still always have a big cash cushion?
Aditi: I did, yeah. So I always have an emergency fund. Always. The emergency fund was very, very large in fact, almost to the point that I think it was too large. So in that moment we were actually not screwed in terms of a financial perspective. But it was still a massive shock to suddenly be like, every piece of furniture we own and the apartment we live in is suddenly gone.
Scott: Yes. Of course.
Aditi: This is New York landlords for you. So there were two buildings right next to each other, tiny apartment buildings that burnt together. One was completely burnt end to end whereas ours was half burnt. So the windows were blown out and our walls were destroyed but the landlords actually worked very hard to get the buildings back up and running so that they could put folks back into their apartments.
Aditi: So some of my neighbors for example got, I shit you not, one day of rent off. And I was like, what? We’re not moving into this burnt apartment. So I went and got a lawyer and went to the landlords and I was like, we are not living … They forced us to move back into the apartment after two weeks and I was like, there’s no way we’re moving into this apartment. The air was horrible. People would ask me if I was a smoker when I would go out because my clothes just wrecked of smoke.
Mindy: They didn’t do any smoke remediation?
Aditi: They did but it was so badly done.
Mindy: Smoker remediation means there’s no smoke smell anymore.
Aditi: They did some level of it but it was atrociously bad. So I went and I negotiated three months off of rent from our landlords. My husband and I told every single one of our neighbors what we’d done and people were just like, “Eh it’s too much trouble. I don’t really want to push back. It’s confrontational.” Whereas I was like, bring it on. Tell me who I have to talk to, to get this stuff figured out. So those were the kinds of opportunities that even though I had a cash cushion, I was also not afraid to go push back against folks. I really made an attempt to try to figure out some of the legality.
Aditi: It turns out that there’s something called the warranty of habitability in New York City that you can use to really push back on your landlords. So we were able to get off three months of rent, which again gave us the ability to build back that cash cushion very quickly even though we had to outlay it.
Mindy: So during that three months were you living in there? Oh sorry, Scott.
Aditi: So we didn’t actually live there for the first month and a half because it was just honestly uninhabitable. But then we slowly moved back in and we were living with friends and family in the month that we weren’t there.
Scott: So Aditi, how did this apartment fire change your outlook in terms of life and finances moving forward from there? Did things change yet again in terms of your asset allocation and how you were going to plan out your financial future?
Aditi: Yeah. So that inflection point was another really important one in my financial journey where something I realized, again this was sort of a repeat of what that car experience had taught me. But stuff wasn’t something I really wanted to invest in. So when we lost all of that furniture that I’d so carefully put together piece by piece, suddenly I was like, I don’t really want more stuff. I just want to figure out the life that I want to lead.
Aditi: It sent my husband and I down this path of, are we living the lives that we want to live in the places that we want to live? That was the starting point of realizing that we really didn’t want to live in New York City anymore. We didn’t really want to be renters anymore and we wanted to go and build a much more sort of balanced life in a different place. So my husband and I conveniently got married in that same time. That was a very eventful year for us. We decided to take a two and a half month honeymoon road trip across the entire country.
Aditi: So we packed our dog in the BMW and drove all across multiple states looking for our next home. We ended up picking five cities that we both actually agreed on but the order in which we wanted to live in those cities was total opposite. So Denver was my first choice with San Francisco being my last and San Francisco was his first choice with Denver being his last. So my husband and I, we left New York City. We went on this two and a half month road trip, and then we both ended up accepting jobs, him in San Francisco and me in Denver.
Aditi: That was where we started this entire new journey, both financial and entertainingly together where we said, okay we’re going to have two different households. He was flying from San Francisco on Friday and flying out of Denver on Monday every single weekend. We lived this sort of tiered life for about a year. But what happened in that time was I actually ended up leaving a relatively large startup I would say and going and working at a very small startup. A three-person startup called Guild Education who I’m a huge fan of.
Aditi: In that year of working on Guild, realized how much I enjoyed the roots of entrepreneurial, the early days of chaos and mess and you’re trying to figure out a business and things are great, things are happening and how do you do that. I loved that experience so much in that year that at the end of that year when I said, okay babe we need to live in the same city and finally moved to San Francisco, it was just very clear to me that I was ready to start my own company. I’d sort of been training for my whole career up until this point to start my own company and I was in a good place financial to do so because I’d been building up all this cash. I had a really good investment portfolio and I’d had the chance to invest in real estate that was bringing me this sort of passive income. So my husband and I had this conversation. We said, okay now’s the moment to really make that leap.
Scott: Can you walk us through what that portfolio looked like that made you feel comfortable with that? Was that a year or two or even more of cash? What was the passive income relative to your lifestyle expenses?
Aditi: Yeah. So I actually thought very carefully about my cash because I knew that I was going to invest in my own business. So I assumed that I was going to make a so called investment of cash into my business. And the good thing that was happening in this time, this was the dynamic that was in the background, was when my husband and I first moved to New York he was my boyfriend. We were not married. And he was a PhD student earning like almost zero money.
Aditi: Whereas over the time once he had moved to San Francisco, he was now suddenly earning a meaningful income and I was quitting my job and going to make zero money. So the dynamic actually totally flipped. But what that allowed me to do was I felt still very secure in our ability to pay our bills because I knew he was employed and he’d be able to make those things happen. So I didn’t think too hard about [Delmar 00:41:04] because I knew that he was making enough money to cover us. But at the same time, what I was thinking a lot about was, okay how do I take my cash, still have an emergency fund in a worse case scenario situation, which we’d experienced, and be able to then go and actually put money into the business?
Aditi: So I took a big pool of money, of the cash that I’d been sort of hoarding as I’d called it at the time and put it into the company. And then I actually took the rental income that I was earning every single month from the apartment and use that as a way to build a very scale down budget of what I could spend. So my goal was to actually not be driving into my savings too deeply month on month but rather living at the baseline of what I was getting by rent.
Mindy: Okay. You keep saying my money, my savings, my. Did you combine your finances? It sounds like they’re separated. And I’m not passing judgment. I’m just asking.
Aditi: Yeah. It’s a great question. So my husband and I, when we first started dating we always saved very different pools of money. We were together for a very long time. We were together for six years before we actually moved in together and we actually lived in different states. So there was always a very strict separation of finances. But we started having shared expenses quite early on in our relationship because we were traveling to each other. So if it was easier for him to travel or cheaper for him to travel, he would travel rather than me.
Aditi: So interestingly, in our relationship we actually got a shared credit card quite early on in our relationship and just put everything that we considered shared expenses on that card. When we moved in together, he was making much less than I was. I was making significantly more money than him, but Delmar is much happier, much more comfortable walking into J Crew and buying a $300 sweater than I am. So I was very clear with him, and this was a direct sort of output of my experience and watching my parents in my childhood. And my parents were divorced and they definitely didn’t agree on money at all.
Aditi: So I was very clear to him that I was like, hey babe I’m happy to pay more expenses across a bunch of different things but the thing that would really just piss me off is if I was paying for all of that and then you went to J Crew and bought a $300 sweater. So it was a really interesting moment for us as a couple because he was like, “No, I hear that.” It was very important to him that he was like, “I want to feel like I’m contributing to the expenses and the household and all of these things that we want to do.”
Aditi: So him and I actually had a lot of very open and honest conversations about money and actually agreed that when we moved in together we were going to sort of pool some of our expenses and use that to pay for all the things that we wanted to do together. We would contribute to those pools in different ways because I was making more. Then we would keep some of the money apart so that we didn’t fight about him going to J Crew or not. He was like, “As long as I’m contributing to our shared pool, you shouldn’t get stressed about if I go to J Crew or not.” And I was like, that’s totally fair.
Aditi: So that pattern continued. So when we actually got married, we talked a lot about whether we wanted to put our finances into one place and he said to me, he was like, “I actually really like the system we’re working with. Are you fine with if we just do this?” And I was like, yeah let’s just keep trying this and see where it goes. It wasn’t until I started working on Zeta and really doing research with other couples that I realized that this phenomenon was actually way more common in our generation because I thought Delmar and I were like that weird, abnormal couple that were just doing things totally different.
Scott: After you transitioned to this new company, what was your goal with money going forward? What was the end goal I guess, on your financial journey?
Aditi: So I thought a lot about this. It’s such a good question to ask. I used to joke but the start of my personal finance class, my first slide was like, here’s who I am and my goal is to get a private jet, was what I used to say. But when I realized is for me, the pursuit of money or generating wealth is really actually about being able to live by my convictions. What I mean by that is what money allows you to do is it gives you optionality and flexibility. I have all these really strong beliefs about how I think the world should work or how you should be able to stand up to certain injustices or how I think the dogs should be treated.
Aditi: What money allows me to do is actually put my money where my mouth is. So this actually came up last week because we’re trying to build a house in San Francisco, and I’m happy to talk about that to the extent that you guys care, that it’s incredibly frustrating and unfair and nontransparent process. The entire time you’re just putting money out there constantly and you have no idea if your project is going to get approved. It’s insane.
Aditi: But the other day we had this moment of inflection where I wrote a Medium post about it and I was about to click publish and my husband said to me, “Is this really worth it to you? Do you want to really piss off the planning department and make it possibly impossible for us to build this house or is it worth it to you to just get the house built?” I sat back and I said, you know what, we’ve put too much of our investment pieces into rebuilding this house but there’s just no way I can blow the money. But why I want to be rich is so that one day I can actually press publish on that Medium marker.
Mindy: Once the house is built you can hit publish.
Aditi: Exactly right. So delayed gratification here. But it was a good moment of me realizing why I was even pursuing this and what the end goal here was.
Mindy: So where are you on the pursuit of financial freedom or financial independence?
Scott: It sounds like a huge pile of F you money is the goal, right?
Aditi: I think that’s exactly right. It’s like a huge pile of F you money that you can use for whatever it is, whatever you think is not happening enough. I joke that the end goal here is to go build a dog sanctuary in Colorado overlooking the Rockies and just saving hundreds and hundreds of dogs from a miserable existence. But where we’re at right now is I realize that yes, I could spend my life trying to spend less than I earn. I could spend my life investing. I could spend my life doing all of the responsible money things. But the truth is, it’s just not my personality.
Aditi: I am what I would refer to as an amassive personality where I hate spending money unless I think it’s going to make me money. So I was very much always sort of at the back of my mind thinking, what I really want to be able to do is one day go build a business that allows me to generate exactly what Scott said, that f*ck you money, or sorry, maybe you can’t say that.
Scott: We’ll edit it.
Aditi: Generate that F you money that you could then go and use towards all these other things that I wanted to make happen. But because of the career that I’d had, I’d spent my entire career working in the impact and startups in technology, I knew that whatever I worked on was going to be something that I felt really passionate about and something that I felt like would have a very tangible impact on the world. So that was the moment where I started to say, okay I think I’m going to spend the next 10 years of my life really working on amassing wealth rather than trying to maintain the status quo or sort of grow at an incremental pace.
Aditi: Not that there’s anything wrong with that approach, but it was just one that didn’t make sense or fit my personality.
Scott: Okay. So what is your plan to amass this wealth? That’s the question I think.
Aditi: You want to get into … Yeah. Look, when you’re in tech there’s a lot of different ways that you can make money. Statistically it actually makes sense to try to go join an early stage startup that’s going to go make it big. So yesterday Slack just IPOed and Slack was one of the companies that I was talking to working at in the early days. So that’s definitely one approach that I could’ve taken. But I think because of my background in entrepreneurship and because I was so interested in this space, I decided to go build my own company.
Aditi: I really wanted to go build a company that was big and that was going to be a household name. Now when I talk about Zeta, I talk about Zeta being one of those companies that you can add to your household stack. The idea that you pay Comcast for your cable and you pay Hulu for your other cable and you pay Verizon for your phone bill. Could you pay Zeta to help you manage your finances? So that was really the sort of personal motivation behind starting Zeta. The more practical one was what I realized, was that the journey that Delmar and I were going through was actually one that was mirrored and shared by a lot more young couples.
Aditi: As soon as I realized that and realized how frustrated we were in trying to figure out our own finances, I thought wait a second, I think there’s a better solution here. I’ve been in tech for 10 years so I was just like, this is bizarre that there’s not a better fix. That was when I chose to start it.
Scott: Awesome. Okay. I want to make an announcement that we’re going to bring you back tomorrow. Wow, this is really awesome. I’m super excited to talk about couples money and the concept behind this. But we’re running out of time today. We still have to get to the famous four.
Mindy: Okay, awesome. Okay, I really want to know about your journey with money with your husband because I get this question a lot from a lot of our listeners. My husband isn’t on the same path or my partner doesn’t feel the same way. And I think this is a huge problem that a lot of people have. Most people don’t talk about money on a date or before they’re dating or … Well not before they’re dating, but before they get married. Nobody wants to talk about money because it’s taboo and it’s not polite and all of that. So I really want to do that but we’re running out of time because this has been a very amazing story.
Aditi: You have such good questions, guys.
Mindy: Do you have time to come back tomorrow to talk more about couples money?
Aditi: I would love to.
Mindy: Okay. That is fantastic. We are going to make an episode 82 and a half that we will release tomorrow. So come back tomorrow and listen to the story about how Aditi and her husband, Delmar, were able to come together, or work together on their finances. But now it is time for the famous four. Aditi, these are the same four questions and one command that we ask all of our guests. Are you ready?
Aditi: Yes. Bring it on.
Mindy: What is your favorite finance book?
Aditi: I’m actually currently reading the Money Diaries book by Lindsey Stanberry who’s the creator behind the Money Diaries. I found I’ve really been enjoying it because it’s very practical and very easy to wrap your head around. But I also have to say I loved the Index Card. I thought it was one of the easiest money books I have ever read.
Scott: Nice. Those are both great books. What was your biggest money mistake?
Aditi: That car.
Aditi: Just the depreciating asset nature of it. I would probably the next time buy a car, buy a used one and one that maybe isn’t so bling.
Scott: Nice. Yeah, I think that’s a great one.
Mindy: That’s not an uncommon biggest money mistake. Frankly, while it wasn’t probably the smartest purchase you ever made, it certainly isn’t the worst money mistake you could’ve made.
Aditi: And it’s been incredible on multiple fronts, don’t get me wrong. It was one of the best things to have. It’s an all-wheel drive so when we went on that road trip it was so awesome to have it. It’s kept up, but God when it breaks, oh.
Mindy: Oh, you’re paying through the nose.
Mindy: What is your best piece of advice for people who are just starting out?
Aditi: I think that personal finance is sort of made to be complicated because the industry benefits from it being really hard to figure out. But it’s actually, if you boil it down, really, really common sense principles which is why I talked about the Index Card. These are like, whatever you can do try to spend less than you earn. Whatever you can do, try not to go into debt. There’s all these caveats to all of these things but I think there’s some very, very basic principles that you can use.
Aditi: A few months ago, I wrote my top five principles in an article and I posted it on my Facebook just as a way of, hey guys you should learn about this. I had all these people, my friends, write me and be like, holy crap nobody explained just these basic concepts to me. So that’s what I really encourage people to just say is, I know money feels scary. It feels like the thing you don’t want to talk about. It feels like the thing you would rather avoid. But if you just take a few moments to come up with two or three rules of thumb that you think you can stick to, it’s a phenomenal starting point.
Scott: That’s great.
Mindy: I love that and I think that there’s a lot of people who discover something new. I’m going to change my life so I’m going to make a complete 180, I’m going to do everything different. And you’re going to fail if you do everything different. You have to do small things. You have to baby step your way into it before you can make these huge changes. I love that.
Scott: What is your favorite joke to tell at parties?
Aditi: Mine is so politically incorrect so I don’t even know if I can … Let me see. One of my more favorite ones is our dogs, we have two dogs who we basically treat as kids. My husband’s African and I’m Indian. So it’s not at parties, it’s actually at the dog park. But we get stopped a lot because of our dogs because they’re two silver-looking things and they’re just really, really pretty mutts. But people always ask us, “What kind of dogs are these?” And I just straight up without even thinking for a second I say, they’re half black, half Indian.
Aditi: People panic when I say that because they’re like, this is such a weird thing for somebody to say and I don’t know if I should laugh or … In New York everyone used to laugh. In Denver people were just like, “Ah, why did she say this?”
Mindy: That is fun. I am going to give a shout out to my daughter, Claire, who asked me, “Mom what is red and bad for your teeth?”
Mindy: A brick.
Scott: Oh man.
Mindy: And I don’t know if she means you’re chewing on a brick or if you get hit in the face with a brick. I always imagine it’s getting hit in the face with a brick. But when she said that, I laughed for a good solid minute. So thank you, Scott. I have told her about these jokes multiple times and now she looks up jokes for me all the time.
Scott: Nice. I like it.
Mindy: Okay, Aditi, where can people find out more about you?
Aditi: Yeah. So you can go to my website at aditishekar.com or you can actually learn about Zeta at askzeta.com.
Scott: Awesome. We will link to both of those in the show notes. I imagine some folks will have a little trouble spending Aditi.
Mindy: The show notes for this episode can be found at biggerpockets.com/moneyshow82. Okay, Aditi, we will call you tomorrow to talk more about your advice for couples that are just starting to have this conversation. So I’m super looking forward to that.
Aditi: It’s my favorite topic so can’t wait.
Mindy: Oh, good. Okay, we’ll talk to you soon.
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