Do You Need a Spending Plan?

By Melissa Tosetti

When going to the grocery store or a place like Target, how many times have you swiped your card at the register, walked out to your car and realized that you have no idea how much you just paid for your purchase?

As convenient as it’s made our lives, the advances in banking and technology over the last 20 years have distanced us from our money and we’re paying the price. Instead of simplifying our day-to-day financial life, in many respects, banking and technology have complicated it. The way money now moves is chaotic at best, catastrophic at worst.

It used to be that you had a job, received a physical check, deposited it into your bank account, transferred some into savings, payed your bills and from there, spent what was left over.


For most of us, paychecks are direct deposited into our bank accounts. Although incredibly convenient, the consequence is that about 60% of the clients we’ve worked with can’t say within $500 how much they earn each month. This is just the scenario for those receiving a steady paycheck. It doesn’t include the millions of people out there who receive Intermittent Income, living on gig economy or commissions such as real estate agents and other sales professionals.

Once your paycheck is in the bank, expenses and purchases can now be paid by:

  • Cash
  • Check
  • Debit Card
  • Multiple Credit Cards
  • Automatic Payment
  • Automatic Withdrawal
  • A single click on the computer and even by a flash of our phones

Who thought we’d be paying expenses with our phones?

Twenty years ago the average American may have had 15 spending categories such as mortgage, insurance, utilities, a phone bill, groceries, and a vacation to name a few.

Now? The average American is spending in close to 70 categories in a given year.

The amount of financial transactions we make in a day are more than we previously made in a week! Our spending is rapid fire.

The result of this new financial life is that without a plan, your money becomes a pinball getting bounced from one unexpected expense to the next, or mindless spending incident, preventing you from having the money for the things you really want to do.

Recently we worked with a couple in North Carolina, who, between the two of them, earn close to $300,000 a year and yet, were barely able to get from one paycheck to the next. At one point during our last meeting the wife said with a resigned sigh, “This happened because we didn’t have a plan. If we wanted something, we bought it, justifying it because we made so much money”.

With a Spending Plan now in place, the couple is on their way to putting their financial life back in order and for the first time in a long time, feel they’re in control of their money.

When first working with clients, many of them will admit that they haven’t wanted to create a budget or Spending Plan because it evokes a feeling of scarcity. They quickly learn that the process doesn’t keep them from doing the things they want – on the contrary – it enables them to do things they want.

After a stellar career in a government organization, one client spent the first years of his retirement bleeding through what he worked so hard to accumulate. Much of the bleed stemmed from the fact that, for the first time in 30 years, he had the TIME to do so many of the things he previously wanted to do but couldn’t, because of his work schedule. His advisor was alarmed by the pace he was blowing through his principal. When we sat down to look at exactly where his money was going (including, but not limited to $24,000 a year toward RV expenses) he soon realized the way he was spending both his time and money was scattershot.

During our work together, he began to pick and choose where he wanted his time and money to go. The result of that process, like so many other clients, is that his quality of life went up as his spending went down.

In fact, this is one of the most common by-products of a Spending Plan. Because of its’ purposefulness, clients not only feel more in control of their money, but because they have control, their quality of life and happiness increases.


If you’d like to schedule a complimentary 15 minute meeting to learn more about how we work with clients to create personalized Spending Plans and then teach them HOW to live within their plans, simply send an email to or if you prefer, call 650-299-1500.