the key to joy in eating, finances, and everywhere

fork and spoon

food and money — two great tastes that taste great together!

Got your attention? Well, I won’t be coy: the key is mindfulness. Surprised? Looking at some of my previous posts on systems, you might think the opposite; isn’t the point of systems to enable you to just breeze through life without really paying attention, and yet still have things turn out okay?

Well…no. In fact, “hell no”.

For instance, take a look at this article on mindfulness in eating from Mind Over Fatter. In it, the author begins with the assumption that mindfulness in eating is important, and then poses the oh-so-practical question: how do we achieve that? Her answer is to give us ideas for implementing a system for improving that mindfulness! Rather than a machine that does your work for you, the system becomes a set of triggers whose sole purpose is to restore you to mindfulness.

It’s like having a series of alarm clocks. The practice of “chewing your food twenty-five times” (as she is reminded by a regular iPhone notification), using the action of stabbing your food with a fork to remind you to wait until you finish what you’re chewing, and other “scripts” are constantly waking you up to the world around you (and in your mouth). They keep you from “falling asleep”, sleepwalking your way through your meal without really paying attention to what you’re eating.

A lot of life is like that, isn’t it? It seems that it’s all too easy to fall asleep, acting automatically on our fears, our greed, our “lizard brain”, rather than waking up to the  world around us. We eat without tasting; we watch TV without engaging; we go to our jobs without being present to the joy of doing good work. We read blog posts without looking to apply their insights to our lives. (Yeah — did that one wake you up? Good.)

And of course, we spend without being mindful.

Really, that’s what budgeting is all about, and if you’ve been paying attention to previous posts, you probably saw that coming. And if you’ve heard it before, then listen, because it’s important and worth hearing again. It’s not about going on some sort of money diet, though it can feel like that it times; it’s not about getting out of debt, though it’s a good way to get there; it’s not about preserving marital peace, though that can be a happy side effect. No, it’s primarily about mindfulness: deciding what your values are, what you want to spend your money on, and then staying awake enough to follow through with that decision, even when the siren song of advertising or peer pressure or habit tries to lull you to sleep. This is vital, because the consequences of falling asleep at the financial wheel are disastrous — just ask the guy with tens of thousands of dollars of credit card debt, and no idea how it happened.

And that’s where the systems I’ve been talking about come in. The Monthly Money Check-In, where you go over your bills and your cash flow, keeps you mindful of where your money is going. Similarly, the Monthly Money Date, where you get together with your partner to go over the household budget and talk about money matters in general, helps keep the both of you mindful not only of yourselves, but of each other. The overnight investment test keeps you mindful of why you bought your investments. You get the idea: each of these systems isn’t putting your life on autopilot, but rather getting it back under your control.

Is it hard? Sure, at first — but so is waking up, and if you’re going to live, why not live awake?


how to prioritize your savings when you’re fresh out of college (and later)

Now the real education begins.You’ve got a shiny diploma, thousands of dollars in student loan debt, and a dozen friends and relatives who each have their own idea about where your money should go. Buy a house! Pay off that student loan! Save for an emergency fund! Invest in your 401(k)! And, somehow, have money left over for, you know, food and stuff!

Fear not: I’ve got a system that can help.

Start off by putting a minimal amount towards every savings goal you have. You heard me: all of them. And when I say “minimal”, I mean it — even if it’s only 0.5% of your  paycheck into your 401(k), the minimum payment on your credit cards, and $20/month for your emergency savings fund, put something away towards each of your goals. The idea here is that you start saving right now, thus taking advantage of the mysterious force of compound interest that makes for interesting graphs like this (from this post). (And yes, compound interest has the same effect whether you’re talking about debt or saving.)

Of course, even compound interest isn’t magic enough to fund your retirement on 0.5% of your paycheck. Which is why the next steps are critical:

Every six months, increase the amount you’re putting away by a set amount. It doesn’t have to be a lot, but by periodically increasing the amount  you put away, you can slowly ramp up to your goal in small, painless increments. The money that would normally go to “lifestyle inflation” will instead go quietly, steadily towards your savings goals.

For instance, you might add 0.5% to the amount of your paycheck going towards your 401(k) every six months. In ten years, you’ll be putting an extra 10% away towards retirement, something a lot of people in their 50’s can’t say!

Meanwhile, choose your Most Important Goal and focus on that. All your savings goals are getting some attention; pick the most important one and give it some extra love. Allocate more of your budget to it; put a high percentage of all “found money” there (the rest you can spend on whatever you want, as an incentive to “find” more); in general, make it a high priority. Once that goal is taken care of, move on to another, and so on. This way, while you’re slowly building momentum on your other goals, you’re always focusing on the most important one. A suggested priority list for a new grad:

  1. One-month buffer
  2. High-interest debt, in order of size (snowball) or interest rate, whichever motivates you more
  3. Emergency fund (3-6 months’ basic living expenses or more, depending on your situation)
  4. Mid-sized savings goals, like your next car or the down payment on a house
  5. Low-interest debt
  6. Retirement

By the time you’ve worked your way down to “low-interest debt”, you should be in really good shape. Will it take a while? You bet. That’s the beauty of long-term goals, though — you have a long time to get them right!

theology of abundance

overflowArguably some of the most important work I do with clients is integrating their financial and spiritual lives — e.g., how does what you do with your money reflect your beliefs about The World and your place in it? Sometimes, a client says one thing, but their money says another, and I have to gently point out where the two differ. However, what can be more troublesome is when a client’s finances follow their theology completely…straight down a black hole of credit card debt. This is most often the case with the Theology of Abundance.

The Theology of Abundance is a fairly straightforward aspect of the Christian faith in particular; it says that you shouldn’t hoard your resources out of fear, but that you should give freely as God has given to you. The example of Jesus feeding the five thousand with only a few loaves and fishes is given as a prime example. And it’s a great theology; that kind of faith frees you to let go of your money, which in turn releases your money’s hold on you.

You can probably see where such a theology might lead you into trouble: “I shouldn’t worry about my finances, so budgeting is, in fact, something to be avoided. I give to the church, and my family, and my friends, and those I meet on the street…and occasionally buy myself nice things. God will provide, right?” And then the credit card bills come in, and that’s amended to, “God will provide eventually, right?” Despite faithfully following Jesus’ example with the loaves and fishes, there’s a twinge of guilt, and a nagging feeling: does the Theology of Abundance actually work in the real world? But of course that would question your faith, so you shove that nagging feeling down and continue to (faithfully!) ignore your finances. And the debt piles up, until you barely have the cash flow to pay your normal bills, much less help anyone else out.

So, does this mean that the Theology of Abundance is wrong? As it turns out, no. There’s a crucial point here that people overlook when applying the loaves and fishes to modern-day life: Jesus didn’t ask the disciples to give what they didn’t have. He didn’t say, “go get a loan of a few hundred denarii, and feed these people”; he asked, “What do you have?” And he was able to work a miracle with that. The trouble is that with the advent of credit cards, it is ridiculously easy to spend what we don’t have, and there’s where we get into trouble. If you want Bible quotes, here’s one from Proverbs that Dave Ramsey loves to throw around: “the borrower is slave to the lender.” He’s not wrong, either; how can you live your life faithfully as a servant of God when you’re already a servant of your creditors?

If you truly believe in abundance, then the only reason you should be carrying credit cards is for convenience. If they’re a temptation to live beyond your means, throw them away and start using the envelope method — it’s actually more fun than you might think! Once you start giving out of what you have, and not what your credit card company has — once you allow God to work with your small handful of loaves and fishes — then you’ll start seeing the real miracles happen.


self-compassion over self-esteem (in finances and beyond)

Many of us born after a certain year have had “self-esteem” drilled into us since we were children. “Good job!” is still ringing in our ears after the innumerable times it was said to us — to the point where the words have almost  become meaningless. And why not? Confidence seems to be the underpinning of almost every form of success, even more so than intellectual ability, and the best way to build confidence in someone is to continually tell them how awesome they are, right?


Per the book by Dr. Kristin Neff of our very own University of Texas, this is more like “stuffing ourselves with candy.” We get a brief “high” of increased self-worth…which then crashes in despair when reality tells us something different. We try to pump ourselves back up by more “positive self-talk”, ignoring our faults and placing the blame for failures on something (anything!) outside of our responsibility…which sets up a continual high/crash cycle that ultimately goes nowhere. After all, how can we improve — really improve — if we refuse to learn from our mistakes?

This affects every aspect of life — including finances. Full of confidence in our ability to stick to a budget, we get aggressive in cutting back on perceived luxuries like new clothes or electronics; the next month, we stare in horror at our five-hundred-dollar Nordstrom or Fry’s bill, and give up budgeting entirely in despair. Full of confidence in our ability to time the market, we load up on “sure-fire winners”; then the bubble pops, and in the ensuing financial and emotional crash we pull our money out of the market entirely. It happens everywhere, all the time; self-esteem not only blinds us, it hobbles us and keeps us from growing.

The alternative? Self-compassion.

Self-compassion goes by several names, like humility or perhaps intellectual honesty, but it is, in its basic essence, deciding not to judge yourself. This does not mean refusing to evaluate your performance in any given area; rather, this means separating that performance from your worth as a human being. It means allowing yourself to make mistakes, with the knowledge that we grow by making those mistakes and allowing ourselves to embrace and learn from them. By acknowledging that we can and will make those mistakes, we can better deal with the consequences.

Of course, this applies to finances as well. When making a budget, we might set more realistic spending limits, or create an “oops” category for mistakes, or set aside a regular time to adjust next month’s budget based on last month’s spending. When designing a financial plan, we might be more willing to seek outside help and opinions, more able to take the right amount of risk, and less likely to panic and “sell everything” in the face of the unexpected.

So, great; how do we do that? The first step, of course, is in acknowledging that self-compassion is a valid choice — perhaps the hardest step for many of us, with our artificially-inflated egos that are more afraid of giving up that false self-esteem than we are of the inevitable real damage that it causes. But by taking this step, we are allowing ourselves to take the next: to surround ourselves with compassionate people. By choosing friends and advisors that judge our actions without judging our character, that compassionately tell us what we need to hear rather than what our egos want to hear, we are setting ourselves up for real growth.

And the more often we hear truth delivered with compassion, the more our self-compassion will grow, our egos shrink, and our lives improve.

a challenge to rich non-budgeters

Last week, we talked about prescriptive and descriptive budgeting — “I Will” versus “It Is.” I did this because they’re useful concepts, but mostly, because I have a challenge for those I call “100% descriptives”.

First, though: descriptive budgeting can be a wonderful goal to strive for. For many people, financial success is defined as freedom — the ability to spend what they want, without worry. By working to increase discretionary income — in large part by paying off old debt and avoiding new debt — this can become a hard-won dream-come-true. And you’ll know that you got there when all of your nearly spending categories become descriptive — they are what they are, and you don’t need to cut back on them in order to meet your goals.

However, your budget should never be 100% descriptive. I have friends who are pretty much there, and some of them can’t stand the idea of budgeting. They don’t like “putting labels on money”. They have enough, so why bother? Why not just make the choices as the desire arises? I have a few answers for that:

How you budget your each dollar determines where you keep it.  If you don’t have a budget to help you make good choices as to how much you keep in checking, savingsCD’s, a retirement account, a 529, or a traditional brokerage account, you end up with:

  • money in your checking account that should be in savings, earning better interest
  • money in your savings account that should be in a brokerage account, earning better long-term returns (if invested properly)
  • money in a retirement account that should be in a 529, allowing you to save for your children’s college education without jeopardizing your retirement
  • money in a brokerage account that should be in a retirement account, not getting taxed
  • money in your employer’s stock that should be in checking or savings, avoiding unnecessary risk

and so on. I see a new example of misplaced money every day, and in each case, they’re losing money, and lots of it — in terms of taxes, interest or capital gains lost, unnecessary risk taken, etc. How much is it worth not to even bother taking stock of your values, or what you might wish you had saved for in ten years?

Money that doesn’t get budgeted often get spent for you. By this, I mean that it goes towards things you don’t really value. The thought occurs to you to buy something, and you shrug and say, “I’ve got the money; why not?” So you accumulate stuff and experiences as the thought occurs to you, rather than thinking about what you truly value. (Note: this is not to knock spontaneity — just as long as it fits with your values!) You spend money way out of proportion to the value you get out of it, and still end up with a vague feeling of unhappiness…so you spend even more money next time, and the cycle continues.

You leave a huge legacy that you didn’t intend. Maybe you don’t spend your money…so you die sitting on a pile of cash. Now, again, a legacy can be a good thing — if it’s planned. However, I’d take a serious look at “Die Broke“; in it, Stephen Pollan makes some excellent arguments for building your legacy while you’re still alive. Certainly this is the case if you have children or grandchildren; in the former case, why not help them out with their first house, their first child, their new business, rather than waiting until you pass on? In the latter, why do them and the world the disservice of making them spoiled “trust-fund babies”?

Your money gets burned by inappropriate investments. What does everyone say you should do with “leftover” money? Why, invest it, of course! So you play around with the stock market, or you have a friend who has this great investment opportunity, or you accumulate ridiculous numbers of shares in your employer’s company…but you have no plan, so when you actually need the money, it happens to be at a low point in that investment’s cycle. (Or, worst case, that “investment opportunity” goes up in smoke!) So you “sell low”, defeating the whole purpose of investing in the first place! (Unless you just enjoy gambling, in which case there’s this whole city I know that’s pretty much built around exactly that…)

So do you have to budget every penny? No. You don’t have to become a spreadsheet junkie with hundreds of budget categories who meticulously enters their transactions every week. Just keep an eye on your finances. Think about what you value. Don’t be afraid to put labels on your money — and to move those labels around as circumstances and your values change!

Your money — and your future self — will thank you.

“it is” vs. “i will”: prescriptive and descriptive budgeting

A lot of people shudder when they hear the word “budget”. And why shouldn’t they? The popular view is that a budget is like a diet writ large — but instead of just limiting your eating, it’s limiting every fun part of your life! No wonder virtually no one keeps a budget — trying to actively limit every single aspect of your spending is a sure recipe for burnout!

Luckily, budgeting doesn’t have to be like that. Enter descriptive budgeting.

Prescriptive budgeting is what you traditionally think of when you think of budgeting: “I’m going to write this number down and pinky swear (or, even better, establish a system like the envelope method) that I’m not going to spend more than X amount on Y.” It’s certainly not a bad thing, and it’s often quite necessary, but it’s not the be-all and end-all of budgeting. As I mentioned before, trying to make it the be-all and end-all can quickly sap your motivation.

Descriptive budgeting is simply entering into your budget what you predict you will spend. You’re not making any effort to throttle back; you’re just stepping outside yourself and saying, “Given what I know about myself (or my family), and what YNAB/ says we’ve spent in the past, how much will we probably end up spending this month?” You already use this for mostly-constant bills, like auto insurance or your rent, and even bills over which you only have partial influence, like your utility bill.

Note: you can combine the envelope method and descriptive budgeting! In other words, just because you’ve decided to pay cash for everything doesn’t mean that you’re actively limiting your spending everywhere. For example, I know some dedicated Ramseyites who pay cash when fueling up their car — not because they’re trying to cut back on gas, but simply because they don’t want to use plastic anywhere. In most of these cases, they use descriptive budgeting to allocate what they think they’re likely going to spend to that envelope. (A little more, actually, because running out of gas money before you run out of month would be pretty disastrous to most Americans!)

So to summarize: with your descriptive budget categories, you’re just putting down What It Is, while with prescriptive categories, you’re putting down What You Want To Do. “OK,” you say. “That’s an interesting little bit of semantics, but…so what? Why even bother with descriptive budgeting at all?”

Fear not — these questions and others will be answered in next week’s post!


my favorite budgeting programs, part 2: YNAB

“You Need A Budget”. No, I don’t mean you personally — that’s what YNAB stands for, and that’s what we’ll be talking about today. Got your attention? Good — let’s go.

The basics. In a sense, YNAB is more traditional than rather than being free and online-only, it’s a standard, non-free piece of software that runs on your PC. Rather than feeding it your bank information, you have to regularly download your transactions yourself (though you can still teach it to auto-categorize and -rename your transactions). YNAB is very non-traditional, however, in its approach to budgeting itself.

“You haven’t budgeted like this.” That’s founder Jesse Mecham’s tagline for YNAB, and he’s not wrong. Rather than setting up a standard “monthly budget”, his program is built around the “Four Rules”, Rule One of which is “give every dollar a job”. That’s not “every dollar of average monthly income”; rather, it’s “every dollar you have, right now”. You don’t budget for an average month; you budget for this month, or until you get your next paycheck, whatever your situation calls for. People used to Quicken or often scratch their heads when first faced with this mindset, but once the lightbulb goes off, it can feel like Budgeting Done Right for the first time. (Among other things, this forces you to review your budget each month, which is vital to creating one that doesn’t break on contact with Real Life.)

Rule Two: Save For a Rainy Day. When you budget, your money goes into “buckets”, in a manner extremely reminiscent of the Envelope Method. And when next month rolls around, any money in a bucket that hasn’t been spent is still there. In this way, you can easily save for non-monthly expenses, like insurance, car repairs, or Christmas, and at a glance can tell exactly how much you have saved up — without having to open a separate account!

Rule Three: Roll With The Punches. On the flip side, if you spend more than what you have budgeted in every given category, YNAB handles it gracefully: the sum of all overspending is taken out of the money available for next month’s budget. So, effectively, instead of it all being taken away from that one category (“great, now I’m supposed to try and underspend on groceries by $100 next month?”), it’s spread out over all of your categories, making things much more manageable.

Rule Four: Live On Last Month’s Paycheck. This Rule is more of a goal than a law, but YNAB is built to guide you towards living on last month’s paycheck, which gives you a buffer for the inevitable hiccups that will occur in life.

Bottom line? If you’re committed to budgeting, I highly recommend YNAB. It’s clean, it’s functional, it does what a budgeting program is supposed to do. However, it’s going to take some work on your part — you can’t get away with not being mindful of your finances, the way you can with

my favorite budgeting programs, part 1:

Speaking personally, I can’t imagine what budgeting was like in the Pre-Computing Dark Ages. As it is, though, we now have plenty of tools to help keep us on track (though how well we use them is another matter entirely). For this week and next, I’m going to talk about my two favorite budgeting programs: and YNAB. (Yes, I’m quite familiar with Quicken, but it didn’t make the cut. If I ever get a reason to upgrade to the latest version, I may do a review on it; in the meantime, though, I’ll take a pass.)

So, what’s this thing? is a completely online, free budgeting program. You visit the site through your web browser, give it your bank and credit card access information, and it automatically sucks in your transactions and balance information and presents it all to you in a very pretty format. You can then use it to track your spending, set goals, and otherwise get a handle on your finances.

The key word with is “automatic”. It was designed from the ground up to make personal finance as easy as possible: it automatically keeps up-to-date with your spending, auto-categorizes transactions as best as it can, sends you e-mails if your spending in a certain category goes over a specified amount, etc. etc. If you hate with a fiery passion the busywork of dealing with personal finances, you’re’s target audience.

It’s pretty awesome. The aforementioned good design and automation can make personal finance almost enjoyable; when I first got started with, I would pull it up just to look at the pretties. Automatically downloading transactions makes it less of a chore to actually track your spending, and the automated warnings you can set up can go a long way towards keeping you on your chosen path.

That said, every rose has its thorns. Automation comes with a price: the lack of mindfulness can keep you from really paying attention to where your money is going. All of your bank account information is stored on’s servers; while is extremely secure (like, a hacker would have to pull off a Mission Impossible or Sneakers-style break-in to get access), I understand if it makes you nervous for someone else to have that sort of info. Finally, is (now) owned by Intuit, makers of Quicken; this can be good or bad, depending on your opinion of Intuit, but the general consensus (and my personal experience) is that customer service isn’t quite at the level it was before the acquisition. So if a transaction goes missing or something else goes wrong…good luck. (That said, they’ve got tons of experience in dealing with extremely sensitive data, so there’s that.)

Bottom line? It’s a great program, especially if you’re in a good place financially and just want a program to do the dirty work of monitoring things. Plus, it’s free! However, if you need or want to pay closer attention to where your money goes, and are willing to be a bit more type-A about it, I’ll be talking about another program next week called YNAB (You Need A Budget).

How about you? Have you used, and if so, what has your experience been with it?


My friend Daniel Hope is presenting a marriage workshop series, and I was honored to give a talk on marriage and money at last week’s session. By all accounts, the most useful piece of that talk was a framework for setting up accounts that I call “Yours/Mine/Ours”, so I figured I should share it with the world at large.

Yours/Mine/Ours is a “middle way” between two extremes I’ve seen in the married world for handling shared finances. On one end, you can share everything between the two of you. It makes things very simple — everything goes in one pot, and everything comes out of one pot — but after a while, things can get…hairy. Maybe he has a habit of overspending on things she doesn’t care for. Or maybe he doesn’t want to spend money on anything, so she feels guilty any time she so much as buys new socks. (Modify genders as you see fit.) Resentment builds, and you either argue about it or, worse, you just don’t talk about it and let the pressure quietly build up to explosive levels.

At the other end, you can decide not to share anything, finance-wise. You have completely separate accounts, and you split the check for everything. Not only does this quickly get complicated — mortgages don’t really lend themselves to being “split” — but it doesn’t reflect reality very well. Does one of you really own all the groceries, and the other all the utilities? And of course this sort of arrangement precludes one spouse from ever leaving work (for example, to raise children).

Yours/mine/ours is a compromise between the two that looks like this:

As you can see, all income first goes into a joint account (“ours”). All shared expenses are withdrawn from that joint account (mortgage, groceries, utilities, child expenses). Also, at the beginning of every month, some amount is transferred into separate, personal accounts (“yours” and “mine”). This money is for individual spending; he can’t say boo about what she does with the money in her personal account, and vice versa. He doesn’t even have to be able to see into it.

This method has several advantages:

It heads off control issues. There’s no question as to whose money it is, or who is ultimately in control. Everything is “ours” first, then “yours” or “mine” second. This is especially key in situations involving disparate income, or where one spouse isn’t working at all; even in the situation where one spouse is a homemaker, this method makes it clear that they have an equal stake in the household’s finances. (And yes, each spouse should have an equal stake, if you want a strong and healthy relationship. Income is irrelevant.)

It’s relatively simple. It’s nearly as simple as sharing one account for everything; the only wrinkles are (a) an automatic monthly transfer from “our” account to “yours” and “mine”, and (b) the fact that you now use your personal account for personal expenses.

It gives each spouse their own space. Everyone needs space to be who they want to be, and this is no less true in the area of personal finance. The “yours/mine” accounts allow you to buy whatever you want, without having to run it by the other spouse. (Note: I don’t recommend attaching a credit card to a personal account. One spouse going into debt “on their own” is a great way to freak out the other one.)

It allows gifts to be that much more meaningful. When you buy a gift for your spouse using your personal account, it means something more than if everything were shared. I mean, this is money that was specifically allocated for your to spend on yourself, and you chose to spend it on your spouse! (Not to mention the fact that this allows for you to more easily surprise them, because they can’t see your bank statements!)

How about you? If you have a similar arrangement, let us know how it’s working out for you in the comments. (And if this kind of sharing doesn’t work for you, let us know that, too!)

can i afford this?

“Can I afford this?” How do you answer that question? If you’re like many people, you immediately think about your checking account, and whether what’s in it will last until your next paycheck if you purchase whatever it is you’re looking at. Alternately, you think about whether the monthly payments will push your “expenses” line over your “income” line. And that’s not bad — in fact, it’s miles better than the alternative many people followed before 2008, to whit: not asking the question at all. But as is so often the case on this little corner of the Internet, I challenge you with the idea that this is not the right question to ask.

This is no newsflash, of course. You can afford a lot of things! If your child (or your inner child!) asks you for a toy or candy, you can’t honestly say that you can’t afford it, can you? A buck or ten is hardly going to break the bank! But at the same time, you need some measure of determining whether or not spending the money fits in with your finances and your values.

Also, just looking at your checking account isn’t necessarily going to give you a clear picture. Yes, there’s some money in there, but how much of it is earmarked for groceries? Rent? Some portion of the auto insurance you’ll owe in October, or (ouch) the property taxes you’ll owe in December? If your financial situation is anything but the simplest, single-person steady-income scenario, you’re not always going to know the answer. And overdraft fees are a painful way to learn you were wrong.

Monthly payment plans — even at 0% interest! — can be even worse. If you sign up for a monthly payment that will go on for four years, only to find that your situation isn’t quite what you guessed it was or that you didn’t really want whatever it is you got, you’re stuck. And heaven forbid you actually want to make a change down the line — say, start saving for a vacation, or take a lower-paying but more-fulfilling job. Nope — you gotta pay that debt first.

No, “can I afford this?” doesn’t really work. A better question, as you’ve probably guessed, is this: “does it fit in my budget?” Suddenly, answers start becoming much clearer. If you have a budget for toys (or simply “entertainment” or “recreation”), then you can easily and simply answer the question “yes” or “no”. No guilt, no fuss, no muss; if you budgeted for it, why not buy it? You’ve already decided how much you value toys; by all means, follow through with that decision! And because each dollar in your budget has one and only one job, you know that spending money from your toy budget won’t affect your ability to pay your insurance or property taxes. A budget will also tell you how much of your spending is discretionary, which in turn will tell you if a given monthly payment will cause you to give up more flexibility than you’d care to.

The key, once again, lies in asking the right question. Picasso wasn’t just messing around when he said, “Computers are useless — they can only give you answers!” How about you? When it comes to making a purchase, what question do you ask yourself, and how do you answer it?