The real reason we fail at budgeting

Happy Sunday from Zurich where it seems like Spring is finally around the corner!

The golden rule of money management is simple:
Live below your means.

There are many ways to do it but the only one outcome to breaking it is financial ruin.

Unfortunately, we never actually explain how to successfully live below your means.

If you save $1/month, you are living below your means.

But is it enough to change your life ?
Not even close.

You want to save/invest enough so your money can:

1. Protect you from emergencies
   

2. Buy assets that grow over time
   

3. Fund a lifestyle you enjoy today

This is where friction kicks in:
The cost of that lifestyle in dollars and in time eats into your ability to do the “responsible financial things”.

That’s where most of us fail

Why Guilt-Driven Budgeting Fails

Our first budgeting attempt start like this:

“I should save more.”
“I’m spending too much on this.”
“I need to cut that.”

It becomes a daily battle against yourself.
And even if you win, it rarely feels good.

Very few of us (if any) have an innate ability to delay gratification forever.

So, your budget can’t just be about saving and cutting back.

It should enable:

1. Long term goals

2. Present day fulfillment (Guilt-Free)

Try This Instead: Value-Driven Budgeting

Instead of budgeting because you feel bad, budget for things you’re excited about.

It’s a mindset shift that made all the difference for me.

Start here:

💭 What Life Values do you want your money to enable ?
For me:

• Freedom: to choose how I spend my time
  

• Security: to not worry if life throws a curveball
  

• Experiences: because I don’t want to postpone living

🧾 Then look at your past spending.

1. List 1-3 things you spent money on that you still remember fondly:

• Last month: Travelled home to see parents

• Last 6 months: Snowboard class,  seeing family (a theme appears), trip to venice with my wife

• Last year+: Safari in South Africa

2. List 1-3 things about your regular routine (daily, weekly, monthly) you most look forward to ? 

• Grabbing a coffee with my wife on the weekends, MMA class, Monthly “surprise date night”

I repeat this exercise every few months and then re-align my resources (time and money) to stay on track.

Next week, I’ll break down my Resource/Value Alignment System to turn the above into actionable decisions.

Start taking Action:

This stuff only works when you do something with it.

If you're ready to ditch guilt-budgeting and build a money system that feels good to use, here's how I can help:

1. If you’re a Do-it-Yourselfer, grab the guide: The Busy Beginners' Money Guide to Build Wealth & Spend Guilt Free - A step-by-step way to set up your money for peace of mind
   

2. Need some help ? Reply to this email: Ask me a question or share what you're working through. I read and respond to every message (No investment advice).

See you next week!

Next week’s topic:
👉 How to align your money, time, and energy with what matters most.

The information contained in this newsletter is for general informational purposes only. It should not be construed as financial or investment advice. Please consult a qualified financial advisor before making any investment decisions.