How to better manage my budget? Don’t live on a budget, live on your frame.

For financial independence, saving is a crucial part. It’s under our control, and without it, you can not even pass to the second phase, of investing and compounding. The F.I.R.E. movement moves it from the 10% wise advice, to more hardcore saving until you reach 60/70%.

For that, living on a budget, and being very frugal are the main components.

How to better manage my budget?

I see it differently. I believe that hardcore saving can become a smooth path if you use your “growth power” in your career evolution. You can then move from budget constraint to a new frame of thinking.
I call it the IG/FG, which means Infinite Growth on your non-material things, and Finite Growth on your material things.

Over the years, I’ve developed a growth mindset. Part of it comes naturally, part of it was designed. What is sure, is that I like it.

Put me in front of new business potential, and my mind will directly start to convert in more growth. I’ve read over 300 books, and that comes from my willingness and interest around this topic. I genuinely believe that we are, as humans, creatures of infinite growth.

This mindset leads me to incredible experiences in my personal and professional life. And in a way, it’s the main reason for my career evolution and my salary increase over the years.

I believe that we can grow in infinite ways in all parts of our life. But do we need to do it? (See the second habits in “The 7 habits of highly effective peoples”. How it has transformed my life, and why it can change yours.)

I see no end in my spiritual, emotional, intellectual, physical quest. A non-ending journey. But should it be the case for the material part, for the money part?

I trust being intentional on what I need, manage my goals and expenses in consequence, which helps me to enjoy more happiness, and facilitate my day to day decisions.

As far as I can remember, I was always cautious with my money. I grew up in a family where we never missed anything, but I saw my parents struggling to close the month.

So at an early age, I already decided that I will be rich. Not knowing what rich meant. To the question, what do you want to do? My answer was, “I want to do a job where I wear a tie”. I might’ve associated riches with people who were in business.

I’ve chosen to start my business career in sales. A profession that can quickly assure you a significant revenue if you perform well. It could even become a trap. As you move to management roles, you increase your fixed salary, but your variable can decrease.

It took a few experiences until I started to gain as much as I could earn in sales. Looking back, it was worth it. I have learned and developed professionally, and I’m now in positions for years where I make much more than I could have on the sales path.

So quickly, I had the choice to increase my lifestyle or choose to live below my means. Driven by my two experiences — the money experience I observed with my parents and my willingness to become wealthy —  I’ve chosen the second option.

As my salaries were quite always comfortable, I have never had any problem living beneath my means.

On a six-figure paycheck, it’s easier to have a high saving rate without feeling deprived of anything. But I could’ve fallen into the other trap of starting to adapt my lifestyle to my earnings, the most common path for people who make a decent salary.

By adapting my new frame IG/FG, I don’t even feel I’m missing something. I’ve decided intentionally to live below my means because I understood quite early that Infinite Growth in the material part has at least three inconveniences:

1. It procures me only a spark of joy for a limited time.
2. It demands attention and time in the now.
3. It steals my most important currency for the future, “my time.”

1/It procures me only a spark of joy for a limited time.

When I buy a new toy, most of the time it increases my feeling of happiness for a short while. I quickly become used to it. If I want to reproduce this spark of joy, I need to buy something new.

Recently my son started to learn to type on a keyboard at school. As we originally come from France, all our keyboards are “French.” We live in Switzerland, and the keyboards are different. So we decided to buy a Swiss keyboard to add to our old iPad.

Searching for a keyboard compatible with the first model of the iPad is a kind of challenge. So my son asked me why we don’t have the last iPad?

And it’s a valid question. We can afford a new iPad. And here is the critical point. Our actual iPad works perfectly. It does everything we need. The day it doesn’t work anymore, we can check if it’s worth repairing it; if not, we can buy the latest one.

Let’s assume we were at the complete opposite. We would have bought every new iPad since. As of today, it seems that there are 21 versions of it.

• You can imagine how many euros it would have cost us?
• How many hours to read the expert review on the internet? (Most of us do that before buying 😃)
• How many hours to learn to use it? To transfer data? To manage bugs.
• How much physical space to store them at home?
• How many add ons: cable, charger, headphone?
• How many boxes and warranties to manage?
• How many arguments between the children and us? Who uses the last one? When? How many hours…

Material things clutter our life, take time, and only bring an outburst of joy that doesn’t last.

2/It demands attention and time in the now.

In a growth mindset, I can easily fall into the trap of setting goals too high on the financial part. But even if it’s feasible, which I believe — everyone can achieve everything if he asks himself the right questions, and focuses on it — but is it worth it?

My goal is to become financially independent, which means that my passive income matches my expenses. When I reach this number, I don’t need more. It does not bring me more. But what is sure, it takes more.
I want to enjoy more valuable experiences and relations now; my children, my wife, my family, my friends, my experiences. In short, my life.
And when I think about my biggest goals; the emotional, the relational, the intellectual, and the physical, these are crucial to my happiness.

Missing clarity on what I really need can push me to fix targets that do not answer my needs and eat all my precious time.

3/It steals my most important currency for the future, “my time.”

I’m conscious that my time is my best asset. I work on a long-term goal to be rich in time. That’s the reason I’ve always been interested in financial independence. 

We have chosen to live in a very comfortable house for a family of four. Yet we could have chosen a place two times bigger as most people with our level of revenue do. But doing so would have stolen my most crucial currency: my time.

I would have saved less, I would have compounded less, and as a consequence lost years of financial independence (e.g. time), which matters the most for me.

And do we need a bigger house? Not at all. More cleaning, more furniture. More maintenance.

Embracing this “minimalist” philosophy helps me :

• To maximize the now. Fewer things, but more time for the now.
• To maximize the future. Fewer things lead to faster financial independence, and so to more time.

I believe in an intentional growth mindset.

Understanding that material items clutter my life, take my attention, and steal my time, helps me to live more intentionally.

I have “Infinite Growth” goals for the non-material part of my life. I have “Finite Growth” goals for the material, the financial part. Money is just a tool that helps me to live my life on my terms.

This frame IG/FG gives me purpose and clarity in my day-to-day decisions and long-term goals.

What frame do you use to make better financial choices?