The Life Energy Experiment – One Year On

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A little over a year ago, I conducted a simple experiment. The essence of it was simple and you can read my rules here.

The Life Energy Experiment

The experiment invites you to consider how much ‘life energy’ (or time in paid work) you have to devote to pay for something you want to buy?

As Henry David Thoreau put it, “The cost of a thing is the amount of one’s life which is required to be exchanged for it, immediately or in the long term.”

As a rule of thumb, I used my gross hourly rate, but if you were going to be 100% accurate, you’d use your net hourly rate (less the cost of getting to work and other work-related costs such as clothing). That really focuses the mind.

Some examples

Imagine your gross hourly rate is £10 per hour (for easy maths) and you work a standard 7.5 hour day. I know that’s a simple way to view this, but let’s take it as an example. You can work out your own figures.

See how much of your life you’d have to devote to earning the money needed just to buy the following things:

  • Take-out pizza from Domino’s – £9.99 = 1 hour of your working day and just moments to consume!
  • New (full-price) coat from Zara – £99.99 = 10 hours of effort (so more than the average working day)
  • Your family’s weekly shop from mid-range supermarket – £120 = 12 hours of paid work (or 1.6 days’ effort)
  • A tank of fuel for a small car – £39.50 = 4 hours of work or half a day in the office! I know that I could get a monthly pass for the bus for just £5 more….

What about things you don’t really need?

Once you’ve started viewing your expenditure through the lens of the Life Energy Experiment, you might hesitate a little as your finger lingers over the ‘Buy it Now’ button.

You might look for ways to achieve the same goals (or to get what you’d like) in other ways:

  • Buying second-hand
  • Borrowing
  • Finding a substitute

Think about the Life Energy Experiment

So, think about the Life Energy Experiment as you go about your Christmas shopping this year.

For me, it’s definitely changed the way I view how I shop and what I choose to buy. And, as Amy from More Time Than Money says, there are times when you look at something and can simply proclaim, “This can stay money!”


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Sticking to your budget – week by week

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For a while now, I’ve been using my dual account budgeting system for our family finances. In case you haven’t read about this before, I use two separate accounts. One is for all of our regular standing orders and direct debits, the other for discretionary spending including food, fuel, clothing and so on.

Use two accounts

Splitting out our two major spending groups means we never have to worry about our bills. These are paid automatically. Plus, we make sure there’s always the money we need in the first account to cover this planned, regular expenditure.

Track with an app

As well as my dual account budget spreadsheet, I’ve been using an app called Spending. This helps me work out what proportion of my overall expenditure is devoted to the different categories I have specified. By seeing the percentages in Spending’s pie chart, I know that I’m allocating the correct proportion of our overall household budget to each category.

Try breaking expenditure into weekly totals

In spite of paying a lot of attention to budget tracking, August seemed like a very long month in money terms. The long summer holidays meant our usual spending patterns shifted and there seemed to be too much month left at the end of the money.

So, I decided to take my ‘what gets measured gets improved’ philosophy a step further. I opted to divide my monthly budget amounts into weekly totals. This way, I could pace our expenditure, and track our overall monthly finances at the same time.

Here’s how I did it

I quickly worked out the number of weeks in the month. It’s easy if every month is February (28 days/7 days in a week = 4 weeks in the month). But, what about a month in which there are 31 or 30 days? Well, a 31 day month has 4.43 weeks and a 30 day month has 4.29. So, that’s the maths out of the way.

An example

Imagine you’re allocating £575 per month to your family food and groceries and you’re in a 31 day month, that gives you £129.84 to spend per week on your weekly shop. Seeing this amount as a weekly total really helps you focus when you’re doing your online shop. I have found that if I spend a few more moments comparing prices and making substitutes, I can keep within the weekly amount.

When it gets tricky

Other items are a little more tricky to manage on a week-by-week basis. For example, a single tank of fuel can exceed the weekly budget, but I know that we only fill up around once a fortnight. For this category, I might allocate fortnightly amounts.

I also think it’s OK to vire between budgets (get me with my finance terminology!). For example, if I know that there are no school lunches to buy during vacation time, I can boost another ‘pot’ if that would be helpful or allocate those funds to savings.

What next?

So, I’m going to continue for the remainder of the month and see whether or not this ‘pacing’ of expenditure makes a difference. At least, I’m not buying stuff we don’t need. That’s such a blessing in so many ways.

How about you? What helps you stay on track? Do you use an envelope system and pay for everything in cash? Do you have a favourite app? Do share!


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