Kia Ora Friend,

I'm stupid with money. The worse part is I think I know everything.

Here is my imposter syndrome kicking in. I wrote a series of articles: the 8 steps to financial security. Yet, how I handle money is far from perfect.

I buy overpriced things I use once. I sometimes throw out food. I have sinned and wasted power by leaving the lights on around the house. I almost never get the best deals on holidays.

I dip into my not-to-be-touched savings on the odd occasion. I have online subscriptions that I do not use. I've paid for gym membership and never been.

I effectively give money away for no good reason.

Should I worry about this?

Before I answer... In fact, throughout all of it, I did one thing that would tip the scales in my favour. I paid myself first.

What does that mean?

After each paycheck, before you even have time to glimpse at the momentary rising balance of your bank account, an automatic payment will take a portion of that money and put it into a savings account (with a different bank and a password I can't remember).

Life is like the universe. It's huge and complicated. When we think about saving money; we look at every star in all the galaxies to tightening down on. But this isn't possible. There is far too much. And it's complicated. There can be so many bills you must pay and marketing fishhooks to go out and voluntarily spend your money. You only have a limited amount of willpower. You can control so little. You can only do so much.

Too much to handle?

So, let's simplify things and focus on the big wins.

And this big win, you won't even be aware of most of the time: an automatic payment that takes money from your paycheck and puts it into a separate account. Without you evening thinking. Or being aware of. Or requiring any effort. So your mind can be used elsewhere. To enjoy a TV series binge, to be your loved ones, or and not feel guilty for leaving the lights on around the household — confident, knowing you are still building wealth.

If you haven't been doing this already, then start small.

Too much money in your cheque account? Then, increase those automatic payments. If you are running low or worried about running out of money, then we now have some incentive to start budgeting.

So to answer the question: should I worry about stupid spending. Not at all. By paying yourself first, time is on your side. And thanks to automation, you are building wealth every time you get paid. Even if you are tapping your card, paying the bills, or adding to cart.

Relax, knowing you are making a big win by paying yourself first.

Interested in more? Please check out my posts on personal finance.

Got something to say? Please hit reply.

If you found this useful or interesting? Please forward this on to family and friends so they can find it useful too.

Thanks for reading and all the best for the week ahead.

Mā te wā,

Shivan :)

PS: Thank you to the reader who got back to me about The Promised Land by Barack Obama. I am proud you are enjoying the book. And yes his voice is super soothing.

My Favourite Things

1. Book Food Rules by Micheal Pollan. My favourite thing these past few days is listening to this book on the morning commute to work. I'm lucky enough to have my partner accompany me on this journey and nearing the end before we part ways we are able to discuss any interesting or important points that we come across. Micheal Pollan is a journalist well versed in food and nutrition. This book contains 64 rules about that we should implement when is comes to food. The rules may seem like a lot to remember, but the ideas overlap in meaning. One of my favourite rules is: "If it came from a plant, eat it; if it was made in a plant, don’t." The rules not only cover what to eat but how we eat as well. This is an quick (only 1 hour) read for anyone who wants to improve their health through food.

2. Video Chris Lovejoy celebrates reaching 1000 subscribers. Chris Lovejoy is a doctor-cum-data-scientist. This video not only embraces the milestone of 1000 but also provides insights into health technology. This is a field I'm excited to get into when the opportunity presents itself. Chris also talks about learning coding while also working as a doctor, which is particularly intriguing because its hard to strike a good balance.

3. Podcast Not Overthinking: How can we optimise for a meaningful life?. I've been a fan of Ali and Taimur Abdaal's podcast for a while now. In this episode, the brothers talk with a guest, Neel Nanda about effective altruism or EA. EA is about how to provide "the action [of giving] that will most improve the world". Neel talks about how EA is not self-sacrifice because at the end we want to give but we also want sustenance. EA is not quitting life and moving to Africa to work for a non-profit. We only need to take small actions to help improve the world. One example donating to charities that are most effective. GiveWell provides insights into the world leading charities. This ensure the small efforts we make are well leveraged in helping others.

Blog Posts

Putting it Together: Step 8 of 8 to Financial Security — shivansivakumaran.com You can follow the steps here for financial security. But you are a human and you live beyond rules and a spreadsheet. Here are the steps again.

The Budget: First Step of Financial Security — shivansivakumaran.com Budgeting is a way to consciously know where your money is going. It is your first crucial step to gaining financial security. I want to congratulate you for…

Finances for Couples • Shivan Sivakumaran — shivansivakumaran.com As a couple, merging your finances can be a difficult process. The ultimate goal is aligning two lifestyles. Different habits and beliefs work harmoniously…

Kindle Highlight of the Week

The cause of almost all relationship difficulties is rooted in conflicting or ambiguous expectations around roles and goals.

Stephen R. Covey, The 7 Habits of Highly Effective People