Your spending holds the keys to your kingdom.
If you know your spending, then you know how much passive income you need to cover your burn rate.
If you know how much passive income you need, then you know how much money you need saved.
And if you know how much money you need saved, you can calculate how long it will take to save it all.
That’s what the Financial Zen Calculator does for you.
To get accurate data, we track our members’ spending through our account aggregation technology. It
takes the guesswork out of the spending question.
But often people want to handicap their spending assumption because of “temporary expenses” (like
having kids on your payroll).
“Once the kids are out of the house, we’ll be living on the cheap.”
“Uh huh,” I kindly reply and then explain that after 13 years of observing people’s “spending psychology”
that your spending almost never decreases.
The reason is due to your mental accounting. You know about what you spend now a month.
When the kids are off the payroll, there will be a new expense to take their place. It’ll be one you never
saw coming and it will feel completely justifiable.
It’s like when your kids dig a hole in the sand too close to the ocean. They may get the water out for a
little while, but eventually the tide will roll back in and fill it up.
One of the smartest ways to save more is to not get used to spending your next pay raise.
You’re not already mentally accounting for that money, so if you save it instead of spending it, your
monkey brain won’t know the difference…
…And your rational brain will laugh all the way to the bank.
