Episode 28: The Wealth On Any Income Book – Section 3: What To Do When Expenses Exceed Income – Transcript

Wealth On Any Income Podcast Episode 28

Hi Folks, Welcome to the Wealth On Any Income podcast. This is where we talk about money tips, techniques, attitudes, information and provide inspiration. I’m your host, Rennie Gabriel.

In the previous episodes I spoke about your five year financial goal; the difference between good debt and bad debt; how good debt can support you to create wealth. We discussed how to complete a Balance Sheet and determine your net worth so you know how close you are to Complete Financial Choice™. You found out there are many sources of income in addition to a paycheck. When you focus on expenses first you’re rewarded with more income. In the last episode we discussed how to measure the level of pleasure based on where you spend your money.

Today, I will continue reading the third section of the Wealth On Any Income book. This section is where I cover the tools, tips and techniques that will lead to you having Complete Financial Choice™ in your life. Today I’ll talk about three broad categories of expenses and the solutions you can use if you’re in the situation where your expenses exceed your income. And filing for bankruptcy is not one of them.

As I read, I could stumble over some words. I am not a professional voice over actor so please forgive me if that happens.


When income and expenses don’t balance, you have to look at three areas or categories: Discretionary, Variable, and Fixed expenditures.

Discretionary expenses are the ones you have complete control over. It may be going to the movies, meals out, personal trainer, vacations, or clothing. Anything where you have complete choice is a discretionary expense.

The next expense items to look at are those that are Variable. These are the expenses that show up month-in and month-out. The only difference is the amount of the expense. As an example, you’ll have a food bill every month. It could be higher or lower from one month to the next based on what you buy. Your utility bills, such as telephone, gas and electric, will come in month after month, but they may be higher or lower depending on usage or time of year.

You may be saying to yourself, “I know this stuff.” My response is: don’t make statements when you hear something you may know. This closes your mind to possibilities and ideas that can create the change you’re looking for. When you hear something you already know, ask questions instead. That’s what people with a wealthy mindset do.

What do you think would be more powerful, a statement like “I can’t use that information in my situation” or “How can I use that information?” Or, “What could I do that I haven’t done yet?”

You’ll notice I emphasized the words how and what. Most successful people recognize they create powerful changes and transformations in their lives based on the questions they ask versus the statements they make. You’ll notice these are how questions. Many people ask themselves why questions, like “Why do I get customers or clients who are jerks?” Or, “Why do I have co-workers who are rude?” Why questions are not quality questions. They create endless loop answers that do not lead to solutions. If you found out why you had customers who are jerks or co-workers who are rude, all you would have is the answer as to why. You would still have rude customers or co-workers. If what you want are nice customers or co-workers, you could ask a how or what question. How questions produce value through the answers you create. How questions are powerful. They can create the changes in your life that produce profits, fun, and anything else you choose. You could ask, “How can I get nice customers?” Or, “What do I need to do to have co-workers speak respectfully to me?” How and what questions lead to solutions. Why questions lead to generally useless answers.

Additional questions can start with the words when, where or who, such as, “Who can support me with getting what I want?”

My second book, Attitudes of the Wealthy, goes into more detail on this, as well as more than 30 more attitudes that the wealthy operate from that most ordinary people don’t.

Fixed expenses are the last area to look at. These are the expenses that come in every month and don’t change. It’s your rent or mortgage payment, car payment, insurance payments. It could be the minimum payment on credit cards, and even these can be changed as well.

As an example regarding rent, I had someone working for me who was struggling to pay $625 per month on a one-bedroom apartment. (In Los Angeles, this was obviously many, many years ago.) I suggested she go out and get a two-bedroom apartment for $800/mo. She questioned me and asked, “Rennie, how could you possibly suggest that when I can’t afford the $625 now?” Simple, if she got a roommate to share her $800 rent, she would reduce her cost to $400 per month, saving $225 per month.

I had another client who owned a boat free and clear which was docked at the marina. He was still spending $250 per month to store it. He hardly used it the year before, but still had to pay to have it painted and re-canvassed. I asked him how much it would cost to rent a boat like that, and he responded, “Oh, at least $100 a day.” And he was spending over $2800 per year just to keep it parked at the marina. He decided to sell the boat, and when he wanted to go out he could rent something two to three times nicer. He eliminated a fixed monthly cost and now doesn’t have to spend any money on upkeep either. What do you have in your life that’s like this?

With regard to credit card minimum payments, you may recall I discussed the book, How to Get Out of Debt by Jerrold Mundis. You can create a credit moratorium and a repayment schedule that shows how to make payments less than the minimum. You can also get more information on this by contacting the organizations I’ll mention shortly.

If re-organizing or consolidating your debts, if selling assets isn’t enough so that your figures balance, it may be time for you to consult one-on-one with a financial planner who specializes in this area. Or, consult with some credit assistance organization like Consumer Credit Counseling Service or even Debtors Anonymous. Debtors Anonymous (DA) is a 12-step program along the lines of the support group Alcoholics Anonymous. It’s designed to help people stay away from unsecured debt and deal with money and spending issues. Information on how to reach these groups can be found on the Internet.

All of these programs are vehicles that can help you create financial freedom if you utilize them. Just like I emphasized regarding achieving your goals, you do not have to do this by yourself. Involve your spouse, if you have one. Involve a friend, go to some organization, become a member of a support group. You don’t have to do this by yourself. Don’t let feelings of shame stop you from opening yourself up to assistance and support. Most of the population feels they’re supposed to know this stuff, and they don’t. They are also just as afraid as you might be to let anyone else find out they don’t know these things. As soon as you ask for support, other people will feel free to shed light on what they need to know.

Don’t let shame be your trap. The people who are transforming their relationship with money are not doing it through books alone. They are not doing it by themselves. They are getting together with like-minded people and getting support for the changes they want to make in their lives.

I often say, “Wealth creation is a team sport, not a solo sport.” You can use the Wealth On Any Income book as a guide to create a group of friends or co-workers who are willing to support one another.


Here’s your opportunity to grow: Calculate how much of your money goes to fixed expenses, variable expenses or discretionary expenses. Now ask yourself if this is how you want to spend your money.

As a reminder, if you want all of the forms that were described in the previous episodes, please send an email to Rennie@WealthOnAnyIncome.com and put ALL FORMS in the subject line.

In the next episode we’ll start on Step 10 of the 12 steps to financial freedom, or as I like to say Complete Financial Choice™. We’ll cover the most powerful way to save and invest the money you work so hard to earn. This is the secret that took me from broke at age 50 to multi-millionaire status by age 58.

Listen to the Wealth On Any Income podcast on your favorite platform and please rate, review and subscribe.

Until next week, be prosperous. Bye, bye for now.

Return to podcast by clicking here.