Assignment 1 of 0

What Story does my Spending tell me?

If you were to look at another persons bank statement, what story could you possibly see?

Perhaps you could tell that they like to shop at Checkers and that they buy groceries once a week, and if you listed all the transactions at Checkers you would be able to see how much in total that they spend there in a month. You could possibly also tell what their favorite fast-food restaurant is, or where they like to buy their petrol, perhaps even the area they live in based on the location of the shops or petrol station they frequent.

Other things you can tell from someone’s bank statement are the hobbies they have. For example, do they shop at craft shops or other specialized stores, maybe a fly fishing shop or music store? You can tell if they like to exercise by whether they have a gym subscription or have spent money at a sports store.

Do they save or invest, or have private medical aid coverage? Have they seen a doctor or visited a pharmacy? Do they spend more than they earn? Are they paying big amounts to debt?

What is the most expensive thing they spend money on? This is their highest lived value.

And what about their habits? Do they draw a lot of cash? Do their debit orders bounce? On what day of the month do they run out of money?

A story about Frank’s Spending

I once read the money story of someone, we can call them Frank, who applied to rent an apartment that I own. This person was required to send three month’s bank statements so that I could read their money story to help me decide whether they would be the right tenant for me.

I noticed a few things about their spending habits and money story, the most important of which were that Frank got paid every month around the 25th of the month. A few days later, around the 27th of the month Frank would go and draw the maximum amount of cash he could from his bank account. On the 1st of the following month Franks debit orders would run and every month over those three months of bank statements, his debit orders would bounce. This was also reflected in Frank’s credit report which showed that he did not pay his accounts on time, and that there were accounts that he wasn’t paying at all.

What story does this tell us about Frank?

  • Frank doesn’t have a healthy relationship with money.
  • Frank does not have healthy money habits.
  • Frank is not committed to paying for the services that he has committed to and is responsible for.
  • Frank likely has debt or is living beyond his means which is why he is withdrawing his cash to pay for his lifestyle and not pay for his bills.
  • Frank is likely not going to honour the debit order for rent that he is expected to commit to and be responsible for.
  • Frank is therefore not going to be a reliable tenant.

With this information about Frank’s money story, I decided that he was not the right tenant for me and so I declined his application.

Do you think that Frank thought he was going to be an unreliable tenant?

Do you think that Frank thought about the story his spending would tell a potential landlord when he sent through his three months bank statements?

I don’t think he thought about any of those things. I think that Frank is living below the line and in unconscious reaction to money. I don’t believe that Frank will be able to change his money story until he becomes aware of the story that his spending tells, and uses that information to make different choices.

The Story of my Spending

Your money and how you use it, tells a story about you. It’s time now to look at your own spending and the story it tells you.

Go get those three months bank statements and credit card statements and take a look through them, line by line, transaction or spend by spend. You can also look at your “Income + Expenses” spreadsheet for reference.

Click on “Start Assignment” to begin.