The Behavior Gap: Why You Don’t do What You Say You Want to with Carl Richards – EP 251

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If you have listened to our Book Club Episode, one of the books we have mentioned is “The Behavior Gap” by Carl Richards. So to further talk about how insightful this book is, we invited him to our show to talk about behavior gap, values-based financial choices, and finding the answer to the phenomenon of ‘why you don’t do what you say you want to’. Join us as Carl Richards makes complex financial concepts that are easy for us to digest. 

You are not alone in not understanding the words that the financial industry and services use.


  • The real heroes. On this day in 1879 Thomas Edison crowned 14 months of testing with an incandescent electric light bulb that lasted 13½ hours. He thought it’d take him 3-4 months and it took 14 months, 40 other researchers, and thousands of failed tests. And actually, Edison was barely even there because he was fixing stuff on his other invention, a telephone, which was already invented by Alexander Graham Bell. But that didn’t stop him from working his assistants to the bone. They tested hundreds of materials and when they found the combo that worked Tommy Edison took all the credit and profit. So today is for the real heroes. The people who made the light bulb possible. Because ideas are free but hard work’s gonna cost ya.

Carl Richards is a Certified Financial Planner™ and creator of the Sketch Guy column, appearing weekly in The New York Times since 2010.

Through his simple sketches, Carl makes complex financial concepts easy to understand. His sketches also serve as the foundation for his two books, The One-Page Financial Plan: A Simple Way to Be Smart About Your Money and The Behavior Gap: Simple Ways to Stop Doing Dumb Things with Money.

The behavior gap and how it affects the way we manage money, especially in the last 2 years

The behavior gap has a specific meaning that has become broader over the last 15 years. The broader definition of behavior gap is any well-intentioned financial behavior but is producing a sub-optimal result. For instance, people would usually buy high and sell low which should be the opposite of what we should be doing. 

The “Herd Mentality” and its effect on the behavior gap

When something gets really exciting, we feel like we’ve never seen it before but we actually have seen it. We become impulsive from the fear of missing out and the herd mentality which is hard to resist when everyone you know does itㅡit plays out to really painful consequences.

Ignoring most financial advice from the media, making your own financial decisions, and how one can discern the two so people can start making their own decisions

Generally speaking, is there some good stuff being said on social media about finance? Carl thinks so but the amount of stuff that will actually kill you is infinite. Mostly they’re dressed in ties and suits and use fancy and big words so it would feel credible at first but they’re not always there to give you advice, they’re there to sell advertising. Carl would try to get first into the principles when it comes to handling our money and they’re typically well researched.

How we can close the behavior gap

It’s going to be challenging but Carl reminds us to just keep the purpose really simple. For practicality, put a space between you, the stimulus, and the response (e.g: buying shoes). 

A unique value that guides our financial planning

  • Carl: Sometimes, it can be fear but usually intentional about community service driving decisions and time with family mainly outside
  • Jill: Driven by community, generosity, and beauty but sometimes lifestyle creeps too!
  • Jen: Time with family – so income flexibility that creates room for freedom

Bill of The Week

Thank you Carl for sharing your bill about the Apple 1 bundle that combines all tiny bills into 1 charge that makes life more simple!

Thanks so Much for Listening!

Thanks so much for listening. Many of you know we have a private community where we do monthly money challenges and offer accountability groups. We want to congratulate one of our members for a big win.

Recovered $98 from Credit Card

So I was going over the budget numbers last night with my husband and finally reviewed the card with the $22k balance (I know). Turns out, there were things on there I had charged as subscriptions but forgot where there - to the tune of $98!

Well, I canceled those suckers before I went to bed and moved the other expenses to the debit card so we can truly attack this debt by not creating more. Not only that, but one of the companies gave me a refund of $37.50 for the unused portion of the service. What a relief to not see those charges anymore!

Congrats! If you want to check out our monthly challenge community head to to see what challenge we have coming up next.

And keep leaving us reviews on iTunes or Stitcher, and sending the screenshot to And don’t forget to share your favorite quote from the episode by using the hashtag #FrugalFriendsNote. 😉

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