Later On

A blog written for those whose interests more or less match mine.

Managing money

with 34 comments

Implicit Spending

Years ago I was mystified at how I consistently failed to have spare money. Then I discovered what I’ll call “implicit spending”: if you rely on some possession that eventually must be replaced (for example, smartphone, computer, car, tires, etc.), your daily use of the possession means that you are implicitly spending money. Say you have a smartphone that you will use for 4 years before you replace it, and it will cost (say) $480 to replace. Then as you use it, you’re implicitly spending $120/year, or $10/month, just by having the phone, above and beyond what you pay for the phone service. That is, when the time comes to replace it, you’re going to have to pony up $480. The actual price at replacement time might differ from $480, but that would be roughly the amount you should have available in four years, when replacement time rolls around.

An apartment dweller might count as sources of implicit spending things like a car, tires, car battery, vacuum cleaner, mattress, TV, computer, and the like. A homeowner must also account (and accumulate) for a roof, water heater, furnace, dishwasher, refrigerator, washer, dryer, exterior paint, carpets, and so on.

In our possession-laden lives, the burden of implicit spending can be significant—and it’s in addition to explicit spending — spending that easily comes to mind, the spending on groceries being a prime example, but also things like utility bills, subscription fees like Netflix, and so on. These are the expenses that come immediately to mind because you pay them frequently.

“Within Your Means” – and update

UPDATE: The “Within Your Means” workbook has been superseded by a new workbook, which I created after using WYM for a few years. This new workbook is simpler overall and includes an easy way to track certain expense categories (through the planning — see the Overall Plan worksheet in the new workbook, which can be downloaded as a template). /update

I created an Excel workbook (download at link — the workbook in Numbers format is also available for Mac users) to facilitate planning a budget, starting with your take-home pay. The workbook also works fine in Google Docs, so upload it there if you don’t want to include among your periodic expenses the $80 per year Microsoft now charges for Microsoft Office. (That fee prompted me to switch totally to Google Docs. I do use two-step authentication, which I strongly recommend to protect your data.)

Each sheet of the workbook collects information on one category of saving/spending (mostly spending, I must admit) and allows you to enter the amounts appropriate for you. Each page is protected so that you don’t accidentally overwrite formulas, but if you want to tinker with it, the password is “123” (without the quotation marks).

Here’s the TOC that lists each sheet in the workbook:

Screen Shot 2020-02-26 at 9.58.47 AM

The WYM License is because at one time the workbook was available for purchase, but now it’s free.

I think if you work through this you’ll be surprised at the amount of money you’ve obligated yourself to pay — on average — each month. And if you don’t have that money, bad things will happen to you, sure as my name is Leisureguy. Take a look, and see how it works for you.

No need to use cash

WYM suggests using cash, but now that online banking is ubiquitous, I use a no-fee credit card (VISA, for me) and charge to the card the purchases I make. Then, when I get home, I go online and pay for the credit card purchases I just made by using money from my checking account.

In this way, I keep my credit card balance due always at zero (or even with a slight surplus, since I like to pay round amounts: $20 instead of $19.63, for example). So long as the balance is in my favor, all is well.

By doing this I avoid interest fees and also the illusion that I still have on hand money that in fact is needed to pay the credit card. In days of yore, when credit card bills arrived on paper each month through the mail, I would sometimes look at the bill and realize I had charged more to the card than I could afford to pay, which led to a balance due that was carried forward, along with (very high) interest charges.

Paying off each credit-card charge as soon it appears on-line me grounded: I know how much money I actually have available to spend.

To help remind me, I set notifications on my credit card account to email me of any charge above $1. That reminder helps because I don’t have to remember the purchase: when I see the email, I pay the charge online.

Not owning things saves money

The fewer material items you accumulate, the less money you must set aside to replace them. A lifestyle that’s light on material goods frees more of your income for saving and spending on experiences and consumables. That’s part of the message of the interesting and useful book Your Money or Your Life, by Joe Dominguez and Vicki Robin. I highly recommend reading the book and trying its ideas. And The Simple Dollar has a brief and useful guide to personal finance.

Sometimes a material object is acquired and valued not for what it is, but to satisfy some psychological need. It’s worthwhile to identify these needs and address them directly than rather than trying to satisfy them by accumulating stuff (and increasing your implicit spending). Watch this brief video to gain a new appreciation of the burden that accompanies the ownership of stuff.

Dominguez, Robin, and others founded the New Roadmap Foundation to provide further support for their ideas. Their website is

Deacquisition: Efforts and costs

When you do acquire a nonconsumable item, it must ultimately be disposed of (assuming you are not immortal). Eventually, you might give it away, sell it (consignment stores, yard sales, Craigslist, eBay, and so on), throw it away, or whatever. For example, a washing machine has a finite life, and when the time comes, you must not only get a new washing machine, you must get rid of the old one. If you’re buying from a store, the store may take care of disposing of the old machine, but if you buy a replacement machine from an individual, disposal will be your solution opportunity.

You might want to record (in a spreadsheet, say) each possession when you acquire it: date of acquisition, name of possession, source, price, and how you will dispose of it. This prevents postponing deciding how you remove it from your possession. Thus when you are considering a purchase—a book, a vase, a chair, a set of dishes, whatever—take a moment to decide how you will dispose of it. You can’t assume that giving it away will always be easy: when the time comes, you might not know anyone who wants it. One way to give things away is through the Freecycle program.

It may then occur to you that you can finesse the problem altogether by not getting the thing in the first place. If it’s a tool, you might find renting it cost-effective. If it’s a book, there’s always the library. And so on: things you don’t own don’t have to be disposed of.

The deacquisition problem is particularly acute with collections. Owners are often quite attached to their collections but when it comes time to dispose of them, they turn out to be white elephants. Collect cautiously. I suggest you collect only those things which you frequently use.

Retirement planning

A comment on 401(k) and other tax-deferred plans: the account balance is misleading. You don’t really have that much money available to spend in retirement because you must pay taxes on the money that you draw out—and it’s taxed as ordinary income. So the total available for you to spend is (depending on your tax bracket) 25%-30% less than the total shown. That’s one reason after-tax savings are so important: the total amount in your after-tax savings is actually available to you.

BUT: Be sure to max all all your tax-deferred options (401(k), IRA, and the like) BEFORE you start your after-tax savings. Also: check out the ROTH IRA: that money sometimes can be withdrawn tax-free.

Finally, take a look at the book Early Retirement Extreme.

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Written by Leisureguy

10 December 2006 at 9:31 am

Posted in Books, Daily life

34 Responses

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  1. This spread sheet is awesome! I am awed. Unreal how powerful a tool this is. Thank you so much. Now how can I put this in my Hipster PDA? 🙂



    8 February 2007 at 5:38 pm

  2. I have listened to many lectures, bought books on financial planning and budgeting, and had consultation one-on-one. I am 33, and have zero saving and need a budget. Your tool is the first thing I feel I could use to
    make my goal of saving that I need to do by next year September.
    This tool gave a clear amount of how much I need to save! thanks.


    Alfonso Nin

    29 October 2007 at 11:46 am

  3. Thank you very much for your kind comment. Makes my day!



    29 October 2007 at 11:51 am

  4. This programme is truly great, I have been trying to manage my finances better for at least a year now and it wasn’t working very well as I couldn’t keep within the budgeted lines. Your way allows me freedom after taking care of all the big ones
    Thanks a bunch



    2 November 2007 at 8:39 am

  5. Hi.

    Just curious, what program did you use to make this spreadsheet?

    I’m on a Mac, and I use Numbers (part of the Apple’s iWork-suite) for my spreadsheets, and normally it handles even complicated Excel-files just fine.

    It chokes on yours however, saying that the program used for making it is not supported…

    Did you use a special program, or else what version of Excel did you use?

    Just trying to troubleshoot, because I am curious to look at the spreadsheet. I am in the middle of making one myself, so any inspiration is welcome!



    8 December 2007 at 4:04 pm

  6. I just used regular old Excel, but it is a multipage workbook, with formulas reaching across pages in some cases. It’s done in Excel 97, originally, and I keep it still in that format.

    If you know someone who has one of the Windows PCs, you might want to take a look at it on that computer for the ideas. Here are the worksheets that it contains:

    FAQs – Frequently asked questions, and their answers. Review this before you start.
    Your income – Just your take-home pay, which is what you control and spend.
    Cash reserve – A reserve equal to 3-6 months of take-home pay.
    Savings – A portion of your income set aside to fund your retirement.
    Fixed expenses – Expenses that you must pay over the course of a year.
    Replacements – You also must pay to replace things that eventually wear out.
    Weekly allowance – Partly discretionary, partly not; paid by cash from your pocket.
    Periodic purchases – Discretionary purchases paid by check periodically.
    Future purchases – Big-ticket discretionary purchases that you must save for.
    Summary – A summary of your income and where it goes—and where you are.
    QuickForm – You can switch to this format once you’re familiar with the method.
    Tips – Ideas to help pare your expenses.
    Your worksheet – An unprotected worksheet for your own use; you can add others.



    8 December 2007 at 4:12 pm

  7. Four words: THANK YOU *VERY* MUCH!


    Daniel Long

    8 December 2007 at 4:27 pm

  8. I found your workbook through LifeHacker and it looks like something I could use to keep my implicit spending at manageable levels. I’ve been able to budget pretty well lately but hadn’t even thought about that part of expenses yet, until two months ago.

    I do have a question; since I live in Europe, is it possible to change to the currency symbols to Euro?


    Mr. Chapel

    9 December 2007 at 1:47 am

  9. Great, great resource!


    Jason Peck

    9 December 2007 at 6:26 am

  10. Jason, thanks.

    Mr. Chapel: Go to a page of the workbook, unprotect the sheet (password is 123), highlight the cells with $, and format them for €. (Excel offers that format.) Then I suggest that you protect the sheet again so that you don’t accidentally overwrite the formulae.



    9 December 2007 at 7:48 am

  11. Sheet opened and all formulas worked fine in Open Office.

    Thank You so much!! I’ve been looking for this for a while now.



    9 December 2007 at 2:03 pm

  12. You have no worksheet for 401K contributions already being made or possible IRAs I might have. For example, I have 50K in a IRA rollover account and take $300 out of my monthly paycheck that goes into a 401K account. Shouldn’t these be counted as savings? If I had an emergency I could take money out of the IRA rollover.


    Dana Carr

    10 December 2007 at 9:10 am

  13. Certainly you can count those as savings if you want. And I provided the password so that you can alter the workbook to suit your circumstances and inclinations. It’s really not intended to be a universal solution. I was aiming at the 80% or so.

    I will say, though, that the point of the workbook is to help people live within their take-home pay—that is, after deductions for the various things like 401(k) plans. And taking money out of one’s retirement savings seems a bad idea, on the whole. Better if one can avoid it by managing the take-home pay so that it covers all expenses.



    10 December 2007 at 9:17 am

  14. Thanks for the info. I know taking money out of retirement savings is a bad idea but in an emergency it might be necessary.


    Dana Carr

    10 December 2007 at 9:26 am

  15. This is really awsome. I just downloaded it and its so easy to understand compared to other applications. Man telling you this is really great choice….Good work !



    11 December 2007 at 12:02 am

  16. @LeisureGuy:

    thanx, I guess Excel ’97 is not supported (too old?).
    It’s not a problem, I work at a small firm where I am ‘the computer guy’, so I have all the PC’s I need to check it out at my disposal (more than I want really, as a matter of fact, being a Mac user at home, but that’s another matter…). I’ll make some time for it soon to check it out. If i’s really good I’ll try to make a Numbers-version of it too (if you don’t mind).
    Ofcourse I wouldn’t mind if someone beat me to it… 😉



    11 December 2007 at 4:44 pm

  17. No problem if you make a Numbers version, though I would appreciate a credit.



    11 December 2007 at 5:47 pm

  18. LeisureGuy,

    My sincere thanks.

    This was a real eye opener; I can now clearly see why my credit cards debts were not dropping as quickly as I’d planned.

    With your permission, I’d like to make a few minor adjustments and pass it on to my friends; I’m Australian and our superannuation (retirement savings) works a little differently over here.

    Again, thank you so much.




    8 June 2008 at 6:55 am

  19. No problem, but I would appreciate it if you’d still give credit and the original source, and describe the alterations you made. This is in case your version ends up being passed along to someone in the US, who could then easily get the original.

    I’m pleased it was helpful.



    8 June 2008 at 9:01 am

  20. LeisureGuy,

    Wow; what an awesome budgeting tool!

    I am heavily in debt, and there is not shortage of companies that want to take more of what little take home pay I have. Your sheets assist me in showing my wife “the money” and why making/sticking to a budget and getting out of debt are so important.

    I really like the spreadsheet, and your spreadsheet coupled with a snowball worksheet (also freeware) from are what I am using to crawl (and I mean crawl) my way out of debt. I use your worksheet to capture all income and variables, then the Vertex42 worksheet to more effectively pay down debt. Between the two of you, I plan on being Credit Card debt free in six years.

    I know this seems a bit petty; but I’d like to change the section that reads:
    “da/te/date” to match my family; I tried the password listed above to no avail. Thank you once again for an awesome worksheet.



    26 February 2009 at 11:08 am

  21. LeisureGuy,
    Nevermind about that password stuff; I guess I had an older version and downloaded the newest from your website. Great stuff – Thanks!!!



    26 February 2009 at 11:37 am

  22. Very pleased that it’s working for you. The best source for the current version (still free) is here on Lulu.



    26 February 2009 at 12:13 pm

  23. this is a WONDERFUL tool. Wonderful, and sobering. I have never looked at my money this way before – if I had a positive balance in the bank, I assumed I was OK … and at the same time, I’m making the most $ I’ve ever made and can’t figure out where all my $$ goes! This tool is a lifesaver. Thank you SO MUCH for making it available. Now I have a LOT of work to do!



    25 July 2009 at 7:42 pm

  24. Thank you kindly, Denise, and feel free to spread the word. The results are especially staggering for those who own their home rather than rent: LOTS of implicit expense in owning a house.



    26 July 2009 at 6:09 am

  25. In the weekly allowance sheet is gives a weekly allowance but in the summary it lists the monthly total. Is that a typo or should it be that way? Mine is giving me the monthly allowance for the weekly allowance in the summary sheet and I had to ammend it.



    21 June 2010 at 3:04 pm

  26. You estimate (or decide) what you want to spend per month in the various categories. The spreadsheet figures out the amount per week and shows you for each category the weekly amount your monthly total amounts to. In the box at the top of that page it shows the total weekly allowance. On the summary page, it shows the monthly total of your weekly allowance.

    I hope this answers your question, but if not, give it another go.



    21 June 2010 at 3:14 pm

  27. I am a teacher in a Christian high school and I ran across your
    spreadsheet while searching for open source budgetary software,
    specifically, spreadsheet based for use in classroom instruction.
    May I use your spreadsheet for those purposes?

    Thank-you for your consideration



    26 October 2010 at 6:07 pm

  28. Absolutely. You can download a free copy from and make as many copies of that as you like.



    26 October 2010 at 6:09 pm

  29. Thank-you very much.



    27 October 2010 at 3:30 am

  30. Hi, great tool im so eager to start using it but just on question…how can I change the $ to £ on each page?-as Im in the UK.
    thank you so much for taking the time to create such a brilliant workbook.



    2 December 2010 at 1:13 pm

  31. Use the password to unlock the spreadsheet then go into those cells to reformat them to the UK system. I suggest that when you’re done, you re-lock the worksheets so that formulas don’t accidentally get overwritten.



    2 December 2010 at 2:36 pm

  32. hey, i thought this was a good article. thanks


  33. Thanks for this!



    19 June 2012 at 3:23 am

  34. I’ve improved and updated the workbook, based on my experience is using for a few years. The new version is simpler and the template (now resident on a shared Google Sheets workbook) can be downloaded in Excel or Numbers format. The new version is also more focused on the identification of expenses by category — e.g., Auto Expenses, Subscription Expenses).

    Take a look.



    11 September 2021 at 4:21 pm

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