Don’t Let the Sequence Fool You
A young man asked me to look over his finances and help him get some control. Included in this conversation was a review of his most recent bank statement.
"Dude, you spent $700 more than you made last month!" I exclaimed.
"I had to buy groceries at the end of the month. What, you expect me just not to eat?"
"No, I expect you not to implode your finances by plunging yourself into debt."
"I had no choice, Travis! Either I buy groceries, or I don't eat."
"The sequence of your purchases isn't what matters here. That $700 of overspend doesn't just get credited to the last $700 you spent in the month."
"Again, I HAD to buy groceries."
"Did you need the other $1,200 of impulse purchases you made before that?"
“……….”
This young guy fell into the same trap so many do. Instead of viewing his money as a giant puzzle, he viewed it as a sequence of transactions. Then, when he had known and tangible needs, he acted (even though he had already exceeded his budgeted income for the month). This is how we end up in debt. This is how we never have funds for wants. This is how we can't afford to invest. This is how we justify not giving. We spend, spend, spend, then when a NEED arises, we flippantly meet that need without regard for the consequences.
It's a psychological phenomenon that often strikes us humans. If you're human, you're subject to it. What's the solution? Have a plan for the month. The WHOLE month. We know we need groceries. We know the rent or mortgage has to get paid. We know we'll need to put fuel in the vehicles. These are known expenses. Therefore, plan accordingly. While we're planning, we should also plan for the fun stuff. Plan for the dining out. Plan for the date nights. Plan for the concerts. Plan for the plane tickets. Plan for the new clothing. The keyword is "plan."
Let's remove the bias toward sequence and replace it with a bias toward intentionality. Oh, you really, really want a new Blackstone grill? Great! Is it in your plan? If not, then don't do it. Put it in your plan next month. Then buy it! The goal here isn't to demonize spending, but to demonize unplanned, impulsive, destructive spending. Let your plan be your plan, then execute. If it includes a fun trip or a Blackstone grill, go for it! But we can't constantly buy things that aren't in the plan, blow past our budget on buying true needs, then blame the needs.
We can do better! We deserve better. We'll thank ourselves for giving ourselves better!
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