Every dollar in his account feels simultaneously spendable and spoken for.
The fix, I argued, is structure: separate accounts that distinguish what’s for this month from what’s for the future.
A Flow Account for monthly expenses. An Icing Fund for bigger planned purchases. When those exist, the question “Can I afford this?” has a clear answer.
But this weekend reminded me there’s another layer to the problem.
The Anchor Game
I searched “Black Friday” and “Cyber Monday” in my inbox this morning. Eighty-two messages. That’s not counting the countless others that were flagged as spam.
Every one of them wants me to compare their price to something.
$200$99.
$500 $249.
Behavioural economists call this anchoring. When we see a crossed-out price next to a sale price, the brain latches onto that original number as the reference point. The sale price feels like a deal. Not because of what we can afford, but because of what we’re comparing it to.
Two Types of Buyers
And here’s where people fall into different camps.
Some people don’t think about affordability at all. A deal is a deal. If it’s marked down, it’s worth buying. The crossed-out price does all the work. No further questions asked.
Some people do pause to check their one-account bank balance. But as I wrote about with Khalil, a bank balance doesn’t actually answer the question. It just shows a pile of money with no context. Is that $2,400 for rent? For savings? For a trip that’s been in the works for months? Hard to say. So the crossed-out price becomes the anchor anyway — because there isn’t a better one.
A Third Type of Buyer
And then there are people who have a system. They know what their Flex spending is for the month — a dollar amount they’ve decided in advance for discretionary purchases. Eating out, retail, gifts, miscellaneous. The small stuff that can be absorbed by this month’s cash flow.
When you know your number, you see the trade-off immediately: buying this means less of that.
Same sale price. Different reference points.
For bigger purchases, they have an Icing Fund holding money specifically for that.
For them, “$200 $99!” doesn’t set the terms of the decision.
The question isn’t “Is that a good deal?”
The question is: “Does this fit in my Flex? Is this something my Icing Fund is for?”
If yes, buy it. The sale price might even be a genuine bonus.
If no, it doesn’t matter what the crossed-out number says. A deal that isn’t for them isn’t a deal at all.
This weekend, every company (eighty-two in my inbox alone!) tried to set reference points for us.
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