The unexamined dollar is not worth a dime

Wise spending decisions aren’t difficult, for you already know the answer; but you’re distracted and deceived

Exam conditions

To know a purchase properly is to know how it contributes to your story

The key to making better financial decisions is to remember, at the point of making each decision, that the number (e.g. the purchase price) is incidental, not integral, to the wisdom of that decision.

Declaring that purchases aren’t about numbers may seem strange, but what is a purchase? I do not mean in a way defined by propositional or procedural knowing.[1] No one struggles to describe a purchase as a trade of money for a good or service, nor the mechanism by which that trade is commonly carried out.

The struggle comes with perspectival and participatory knowing. Sometimes when we trade we buy into things. Other times, we are sold on things. The job of an unscrupulous salesman is to rob trades of their perspectival context: to screw with your understanding of what is relevant to you in your current circumstances. The quickest way to sell you on something is to make you forget its opportunity cost – all the other things you could do instead, especially the long-term ones, and narrow your view to the immediate monetary cost. You’re more likely to jump into your wallet when comparing a price tag with your credit-card limit than the story something is telling about you with your values.

Yet a trade is inherently participatory. We are interacting with the world based on who we are, and in a way that changes both who we are and how we subsequently interact with the world. We are analysing, expressing, and creating our identity all at once. We are not merely taking ownership of an object; we are internalising it. Understandably few salespeople want you to question if you fancy consuming their wares in such a symbiotic way.

Conscious consideration of perspectival and participatory factors isn’t easy. It can’t be. It concerns you, and you are complex. And true complexity is irreducible.[2]

In the moment, this doesn’t feel like a big problem. But it quickly becomes one when you compound each in-the-moment decisions into the lifetime of decisions in which it sits. Decisions are only ever made in the present. Becoming wiser with money is about making better in-the-moment decisions such that they sum to a better life.

However, mere exhortations to live in the ‘here and now’ don’t work. They either aren’t remembered when needed, or are excused by belief in ‘exceptional’ circumstances – an ironic overwhelm of ‘one-off’s.[3] To preach about the present is to make the same mistake as it tries to correct: it’s to fail to see each decision as a step along a journey whose path is written in the wiring shaped by all your previous decisions.

The same mistake is made when people talk of instant and delayed gratification. Without context, neither is good nor bad. The person that’s praised for resistance could be unthinkingly kicking a can down the road because they see not an action that will likely make their life better, but because they are blinded by a simplistic belief that delayed gratification = good, while also failing to see that if you delay forever, you end up dead before you end up gratified.[4] Recall how diets based on denial cannot work: if a gratification is delayed only with a fight, then even when you come to consume it later – If during the delay your story of yourself as the person who ‘wants’ the short-term dopamine hit doesn’t change – what have you really won? To call either the instant or delayed variety of gratification ‘good’ is to make the mistake of assuming it’s only the consumption that counts towards the Goodness of a life.

To isolate the past, the present, or the future also fails to see that past and future are both part of the present. A decision that extracts itself from your narrative may be easier to model, but it becomes useless in the process. For example, your memories, your sense of self, and the psychological security from knowing what you have lived through already are ‘past’. Your anticipatory happiness and psychological security from imagined consequences are ‘future’. They all shape your centre of narrative gravity. They all contribute to your decisions in the present, and determine whether a decision can subsequently be thought to have worked out well or not.

Stopping and thinking about such things is not as easy as gliding along on unthinking neural grooves, but if the aim is to get reroute unhelpful grooves and live a better life, not stopping and thinking is suicidal.

The cognitive load of connecting every purchase to a grander narrative – zooming in and zooming out at the same time – is unfeasibly heavy. So we turn to heuristics. But we need more thoughtful heuristics. We need not be more conscious about every decision if we are more conscious about how we cultivate our ability to connect the now to our narrative; if we set ourselves up to take right action by the effortless effort of wu wei.[5]

An unexamined life is an unfulfilled life

To follow right knowledge with right action requires not having better knowledge, but becoming a person who uses it more thoughtfully

To take right action without it being a right pain means shifting from our having mode to our becoming mode.

This modal shift is more than a reorganisation of priorities. It is not shifting the balance between thinking and unthinking and engaging the brain a bit more than usual. It’s a shift in one’s mode of living and interacting with world. It is a journey of becoming a thinker, rather than a collection of having particular patterns of thoughts in isolation. It is remembering that an underlying purpose of creating a home, say, is to become mature, rather than just to have a house. A shift into the becoming mode is necessary for the systematic overcoming of self-deception. Tackling decision-making errors one by one is as impossible as eating healthily while still identifying as someone that ‘wants’ cake. However many battles you win, you’ll never win the war.

Failure to make the shift condemns thinking things through to being forever a chore, never a habit. It is to live forever in the land of get-rich-quick schemes and diet pills, of dashed hopes and endless frustrations, and to be tossed about by the unrelenting entropy of self-deception. To bring order to entropic chaos needs something to get in the way. That something is examination.

Socrates’ assertion, when on trial for his life, that ‘the unexamined life is not worth living’[i] may be the most famous line in classical philosophy. But what does it mean? Socrates is saying that he would rather die than live a life governed by self-deception. He was sentenced to death for seeking wisdom, for trying to understand what is real and living in alignment with it; for seeking to establish a rational basis for what to care about, and what to do. Aligning what he did with what he cared about, rather than with what unreal deceptive influences told him to care about, was so important to Socrates that he was prepared to die for it.

‘Leading a considered life,’ wrote Derren Brown, some time later, ‘is about getting our story right for ourselves. It's as simple as that. If we, at any point in our lives, can look at what we're up to and feel that everything is more or less in its place, and that our story is on the right tracks, we will have a good basis for happiness.’[ii]

To live, rather than to drift along inert, is to participate in a process of growth, as David Cain explains:

The difference between people who grow and people who stagnate is the habit of self-examination. It amounts to little more than asking yourself what your lifestyle is creating and whether you'd like to create something else instead. Living without self-examination means you will be simply following incentives as they pop up in your life, like a trail of little cookies, without knowing why you're doing it, who is placing this trail, or where it's likely to lead. Essentially this means your circumstances will always be doing the steering. Your life will be what happens to you.[iii]

We want to be in control of our lives, yet the means of being so scares us. The ratio of those that quote ‘the unexamined life is not worth living’ to those that schedule time to do such examining is, I would guess, similar to the ratio of those that want to get healthier, know how to do so, and yet fail to take the necessary action. Cravings call for calm interrogation. They instead get credit cards. Our Good Life may depend on asking a craving what circumstances inspired it, what emotional itch it is scratching, what values it aligns with, and whether the same thing worked last time we tried it, but that still isn’t enough to stop us in our unthinking tracks. This shit runs too deep for that, as Susan Wolf explains:

Our initial pretheoretical or intuitive judgments about what is valuable and what is a waste of time are formed in childhood, as a result of a variety of lessons, experiences, and other cultural influences. Being challenged to justify our judgments, being exposed to different ones, broadening our range of experience, and learning about other cultures and ways of life will lead us to revise, and, if all goes well, improve our judgments.[iv]


A word of warning: examination is not budgeting.[6] Examination does not equal a focus on metrics. What gets measured gets managed, but if you divorce the measurement from the meaning, you’re managing the measurements, not the life they should be serving, mistaking the means for the meaning. Beware Goodhart’s law: ‘When a measure becomes a target, it ceases to be a good measure.’

A crucial failing that robs measurements of meaning is to focus on absolute, rather than relative metrics. Absolute metrics are about comparison with others. Relative metrics are about comparison with yourself. The former offers only basic, and ultimately unusable, propositional knowledge. The latter is more participatory.

Examination is an approach to life, not the structure of a spreadsheet. There are budget-like tools that are necessary (at least to begin with) to properly examine your expenditure, and we’ll get to them later. But they’re of no use to the unprepared mind.

Because all purchases are trades, all purchases are investments: the giving up of something in the hopefully wise prediction of getting more back in return. And what is it we are – in every instance – investing in? The Good Life. Remember Principle #2: There is only one goal. Proper examination converts numbers into narrative. Regardless of their relative importance, unexamined earnings and unexamined expenditure do not add up to a life worth living.

Budgeting is bullshit

Traditional budgeting cons us into thinking we’re being wiser with money, when it can be subtly making us dumber

Budgeting is bullshit. I use the word in the technical sense.[7] Bullshit is not about falsity, but fakery. Bullshit can be true or false. The point is the bullshitter doesn’t care. They care only about looking like the truth.

You can’t lie to yourself, because lying relies on believing and belief isn’t a voluntary action. You can’t lie to yourself and believe that something you know to be true is actually false. But you can ignore the truth; you can act as if it weren’t true. You can bullshit yourself. We all do it almost all the time. Because bullshit relies only on attention. And while most people’s attention may spend most of its time as a hostage to the latest notification ping, you can consciously control it. If you pay attention properly, the object of your attention becomes exponentially easier to pay attention to. It thus becomes more relevant to you, and you become less concerned by other things, like, say, market news.

Budgeting as it’s traditionally done is bullshit. It is deceiving ourselves that we’re being awfully wise with our money, but in such a way that the very veneer of wisdom gets in the way of actually becoming wiser. We count to assist the examination of our lives, but believe the act of counting is the examination. We therefore stop too soon. The purpose of budgeting is to make better financial decisions, yet by focusing on the number rather than the narrative, it can inadvertently stop us from doing so.[8]

This affects each person differently, depending on their wealth. Because budgeting is framed as a means of comparing ins to outs, those with the highest ins think counting the outs doesn’t matter. Those with the lowest ins spend their lives fire-fighting the outs.[9] Each one believes thinking about the story their expenditure is telling is irrelevant.

Conscious consumption is more likely among the masses in the middle. However, even there, a majority still dream of earning enough precisely so they do not have to think about what they’re spending it on – even though it is the alignment of that expenditure, not its accumulation, that determines the Goodness of it. This is especially pertinent with regards to saving, which we’ll look at in the next section.


Budgeting should be an examination of the expression of our expenditure: is the story it tells about what we care about aligned with what we actually care about? Is it a tale of ever-wiser choices, or of enabling addictions?

Even when we do construct or review a budget, we do so with categories imposed by credit-card companies, or on account of where we bought something, rather than why we bought it. Just as what we spend on a house can represent attempts to meet a myriad of emotional needs – positive and negative – so too can the same small expenditure tell a different story at a different time. Sometimes a coffee is a great investment in a treasured friendship. Sometimes it’s a crutch of someone who’s adventurously deprioritised sleep. Dumping data into a spreadsheet is no more examining it than bookmarking an article is internalising its ideas.

Traditional budgeting isn’t terrible, but it’s not insightful. It can work like a food diary – where the very act of upping attention cuts out the worst behaviour – but these are surface level, and therefore unsustainable, changes, not shifts in mode.

The purpose of budgeting is to make better decisions, not to count beans for the sake of it. As we’ve seen, decision-making goes awry because of a poor relationship with money. This cannot be solved by more money. You can’t earn your way out of a misalignment between your spending decisions and your values.

So called ‘F-you money’ believes it is saying that the consequences of decisions don’t matter. This is clearly nonsense. What it’s actually saying is that the consciousness of those decisions doesn’t matter. Yet to live unconsciously is hardly ‘to live’ in a meaningful way. All purchases are investments; it’s not wise to double down if you’re betting on bullshit.

Non-bullshit budgeting

Every purchase should be both guided by one’s values and a means of refining them

What makes a budget bullshit is never measuring the right thing, because we believe measuring something is a worthy substitute. Done right, examining our expenditure is a means of beating self-deception; done wrong, it enables it.

Budgeting should be fun. Thinking about the wants you’re about to fulfil, and then reminiscing about having fulfilled them should be genuinely enjoyable. As should the never-ending, but ever-progressing challenge of allocating scarce resources in service of those wants. Progress is inherently pleasing. When you buy something that you know has just made your life better, it feels wonderful. It doesn’t become less wonderful to remind yourself of that.

Budgeting is either ignored or abandoned because it feels boring. Yet budgeting gets boring only when we mistake the measuring means for the expressing ends. The purpose of a budget is not to compare our income to our expenditure, but to examine our expenditure to better align it with what we care about. Real purpose pumps us up; pretend purpose bores us. The answer to counting badly isn’t to stop counting.

The message of this book is that most money problems are ones of self-deception, and we defeat self-deception with becoming wiser. We do this by focusing on who we are becoming over what we have, the narrative over the number, and consciously controlling our actions from within over unthinkingly absorbing them from without.


The difference between a bullshit budget and a non-bullshit one can be shown with savings plans. In short: do you save first and spend later, or the other way around?

Budgeting for many is a tool to increase savings. The traditional method is to add up typical costs, and aim to save what’s left over. Yet spending happens more reliably than saving, so which does it make more sense to prioritise?

Trying to ‘cut’ expenditure yields very different results from consciously re-choosing it. We cut only what’s obviously wasteful, while we unthinkingly continue to ‘choose’ all sorts of stuff that doesn’t add anything to our lives, but doesn’t obviously detract from them either. Yet it does detract, from all the other potential uses of our monetary and mental resources.

Because of this, and because spending, like work, fills the space allocated to it, what’s ‘left over’ is fragile. It needs protecting. It needs to come first, not last. Especially if we want to inspire a modal shift from ‘saving some money now and then’ (however regularly) to ‘being someone that saves’. We want the latter; we kid ourselves into believing the former is a proxy for it. If our chosen savings rate proves unsustainable, we can always lower it, but we shouldn’t stop it.

Those struggling to make ends meet may find so little left over that they conclude saving anything isn’t worth it. Yet the habit of saving is always worth it, whatever the amount. Getting started makes getting going much easier. And what may start as a necessity quickly becomes wired into a mindset that lasts longer than the circumstances that inspired it.

At the other end, those who can’t help but save no matter how much wagyu beef they eat and first-class flights they take, believe this excuses them from thinking about anything as trivial as if all those resources – and thus their life – could’ve been better spent.[10]

This can be extended to everything we spend. For viewed through the lenses of narrative v numbers, becoming v having, and thinking v unthinking, everything is a lifestyle choice. A budget is merely a means of making those choices clearer and more conscious.


We act as if money problems will vanish if we run from them, but in the long-term the opposite is true. Fears grow in the dark and dissolve in the light. Making better money decisions in a self-reinforcing way requires becoming wiser with money – making aligning our resource allocation with our values systematic. This requires overcoming self-deception, chiefly by consciously connecting short-term numbers-based actions to our long-term narrative-based stories of our lives.

The bridge between short-term actions and long-term values is built in the brain. The miracle of neuroplasticity[11] is in linking seemingly insignificant actions to the hugely significant shaping of one’s life story. Recall that a story is a device for making the impossible inevitable.

Gaining traction is tricky. But it’s the only way that works. Just as people who’ve cured themselves of chronic pain with visualisation exercises may have spent six months or more doing hard work with no observable results, so making wiser spending decisions could have little to show for itself for a long time. But eventually transformations happen. And there’s no going back.

Self-examination is non-negotiable, but there can be a role for a coach to play too. However, as we’re about to see, the people in the best physical position to help are often in the worst psychological position to do so. Adviser or enabler?

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[1] As defined in Part 1, Section 3.2.

[2] Much may be made of those who can ‘explain complex things in simple ways’, but what these people are really doing is explaining simple things that are typically explained in unnecessarily complicated ways. But because this talent is rare, and because we mistake simple for simplistic, we imbue them with powers they do not possess. At best they can explain a simplified version of a complex idea. [I’ll probably expand on this in a new part of the Introduction soon.]

[3] Every client I’ve ever met has described each and every year as ‘exceptional’ when asked to analyse what they’ve spent their money on during it.

[4] We’ll sidestep for now the fact that most examples of gratification are actually succumbing (or not) to an addiction – so whenever you consume the thing in question you’re probably making a mistake. We’ll return to this when considering wants and addictions in Part 2, Section 3.2.

[5] See Part 1, Section 3.4.

[6] We’ll look at better budgeting in more detail in the next section.

[7] As set out by Harry Frankfurt in his wonderful essay On Bullshit.

[8] Though any form of budgeting is unlikely to lead us to make worse decisions. It’s not a terrible idea, it’s just not a good one, when the same effort can be more effectively directed.

[9] They may still be buying stuff that makes their life worse, but don’t notice because they’re so focused on finding the cheapest version of that unexamined thing.

[10] Recall Trigger #1: ‘better’ is not the same as ‘more expensive’. No one believes their spending is extravagant. I’ve known people burn through half a million a year or more and believe that while their lifestyle may be unusual, it’s not unhinged, apparently unaware that the actions of which they boast indicate that they are either incredibly stupid, or incredibly miserable.

[11] As per Part 1, Section 3.1.


[i] Plato, Apology

[ii] Derren Brown, Happy

[iii] David Cain, How to Save the World

[iv] Susan Wolf, Meaning in Life and Why it Matters

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