This is such a simple truth that I cannot restate enough: make spending decisions based on data.
That data can be your budget or any other data you are tracking.
In the past, I have ignored this simple truth. I have made decisions based on what is in my bank account and not on what is planned for the rest of the month, the following month or expected expenses over time. I have to start practicing living (and spending) by this essential, basic truth.
Every spending decision is a trade-off between your personal goals.
Spending £70 on a frying pan right now means that something else has to take a hit either now or next week or next month. Every spending decision is a trade-off between your personal goals. Making spending decisions based on data allows you make those decisions contextually, recognising the trade-offs you are making in the moment. But if you don’t make those decisions using data, you decide out of context and don’t recognise that although your £70 frying pan may seem reasonable now given you have the money sitting in your bank account, it means another one of your goals will have to be compromised. Making decisions with this information (of what exactly you are compromising) at hand enables you to ensure you are aligning your spending in the moment more accurately with your true priorities.
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