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Managing Expenses And Saving Money With PAIR

All of us make impulse buys. We sometimes look back and wonder why we make that purchase in the first place. In order to manage expenses, I came up with PAIR, a purchase evaluation checklist that you can mentally go through whenever you make a purchase. While the checklist is not foolproof, it is a good start if you keep making impulse purchases and have trouble controlling your expenses.

Personally, how I control my expenses is that I rarely spend in the first place. You can take a look at how little I spend each month. Currently, I have a priority which is to save as much as I can to put into the markets should a crash arrive. Any discretionary expenses will take a back seat before my investment war chest is deployed.

How I do things is not feasible for people who want to live a typical life with entertainment and owning material goods. While people get their dopamine kick from consumerism, I get mine from saving money and seeing my bank balance go up. I am just wired differently.

I noticed that I quickly evaluate any potential purchases mentally. I came up with PAIR, a structured checklist to help guide purchase decisions.

Not Sure Where Your Money End Up?

If you already have a fixed budget for your expenses, you probably already have your own mental checklist to see if you need to make that purchase or not.

my wallet looks like a onion when i open it makes me cry

Source: Meme Generator 

For the rest of you, you are here because you need help with your expenses. The first thing you have to do is to track every expense that you make. I know that it is a huge chore to record every expense but it is important to do so to see what you are spending on. After getting your expenses in check, you should have an automatic budget system built in your mind so you can stop tracking your expenses. Once you are an expert, an internal alarm should ring when you exceed your budget for a certain category. You will adjust your budget by lowering your budget for other categories or eating into next month’s budget.

However, when you realize that you are slipping up and not meeting your financial goals, you will need to start tracking your expenses again.

Goals, Budget And Tracking Expenses


Your expenses should not be interfering with you reaching your goals. You need to identify your goals and then budget around them. Examples of goals include

  • Clearing debt [VERY IMPORTANT]
  • Starting a business
  • Vehicle purchase
  • House mortgage
  • Wedding planning
  • Home renovations
  • Achieving financial freedom


You will start with your sources of income followed by deducting your expenses. When I started employment, I used excel to come up with a simple budget. This was how my budget looks like.

Sample budget

You can include your budget for saving for your goals e.g. clearing debt, house mortgage here too. My primary goal is to invest so my budget only included the bare essentials.

Make sure that your budget is reasonable. Do not over or under budget excessively or else the budget will not be useful. If you are unsure of how to budget, you can first set an arbitrary budget and then compare it to your first month of expenses then adjust accordingly.

Your budget will also evolve as life goes on. Examples of when your budget will evolve includes

  • Old goals achieved
  • Old goals no longer relevant
  • New goals
  • New milestone in life (e.g. marriage, childbirth, retirement)

Tracking Expenses

You need to capture the data for you to analyze your spending habits. Expenses need to be tagged into the different categories as and when you incur them.

Common categories include

  • Food
  • Transport
  • Entertainment
  • Investments (I know that it is an asset but since it is money going out, I treat it as an expense)
  • Insurance
  • Telephone
  • Taxes

If you find out that you are spending excessively in specific categories, you will need to watch out and implement a strict budget. I am personally using an app, Money Manager, to keep track of my expenses.

As mentioned, once you are used to keeping within your budget, you do not need to keep track of all your expenses any more. You can just monitor your bank and credit card statements periodically to review your expenses.


The checklist below is just a guide. The checklist is to assist you in meeting your budget and goals. If you already set aside a budget for discretionary spending, you can just go ahead and spend. If the joy of making the purchase significantly outweighs the delaying of your goals, just go ahead and buy it. Suffering excessively to meet your goals is not worth it. It is also not sustainable and there will be a high chance of binge buying.

If you exceed your budget this month, you can just compensate by spending lesser next month. You just have to make sure that long term, your finances are moving in the right direction towards your goals.

PAIR – Purchase Evaluation Checklist

After setting up your goals, budget and expenses tracking, we can finally move to the PAIR checklist. The main purpose is to slow down and stop any impulse purchases. You can mentally go through this checklist quickly especially for discretionary spending.

[P]AIR – Purpose

Is it a need or a want?

Why do you need to make this purchase? What function does this purchase fulfil? Is it something that you really need e.g. for work, necessities? If you do not need to make the purchase, skip the purchase and let the money go towards your goals.

Do you need or want it now?

Can you delay the purchase? If you do not need it now, you can wait until the product is on sale then make the purchase. By delaying your purchase, it can also slow down your decision-making process and prevent impulse purchase.

Do you already have something that can fulfil the function?

Are you buying another pair of shoes or an additional piece of clothing? When you already have something that fulfils the function of your upcoming purchase, you need to think hard about whether you need to buy that item. You can save money and also save the environment at the same time. For example, the textile recycling rate in Singapore is extremely low at 4%. Annually, 161,000 tonnes of textiles are burned and sent to our only landfill that is projected to be full by 2035.

P[A]IR – Affordability

Have you budgeted for this purchase?

If you really need that item, you need to start budgeting and save for it.

Will the purchase interfere with your goals? 

Don’t let that impulse buy and temporary dopamine hit get in the way of attaining your goals.

Do you have enough cash flow for the purchase?

If you do not have enough money in the bank to make the purchase, you should skip the purchase. If you would like to make use of a credit card to make the purchase, make sure you do it without suffering from the pitfalls.

Benefits Of Credit Cards

  • Cash flow
  • Increase interest earned in your savings account
  • Earn points/miles/cashback
  • Ability to dispute expenses as compared to debit card payment.
  • Building a good credit score

Pitfalls Of Credit Cards

  • Spending more than what you can afford
  • High fees for missing a payment or not making full payment
  • Anxiety during annual fee season
  • Building a bad credit score

Do not purchase items on credit when you cannot afford them. Treat your credit card as a debit card. Always pay your credit cards bills in full AND on time to avoid any interest or late payment charges.

PA[I]R – Increase Quality Of Purchase

Consider buying a higher quality item although it costs more. This purchase should last longer, have better efficiency and quality to increase your quality of life. It will lead to less waste and lower total cost as you will not need to purchase a replacement that quickly.

broken daiso grip trainer

A $2 Daiso grip trainer that disintegrated after a few years and will end up in the landfill

An example would be a cheap $20 blender that my mother bought. The capacity is small, blending power and quality is low. The plastic container was clear when we first bought it but towards the end, the container turned sticky and foggy after a few months. I bought a Philips blender in June 2019 for $130 and it is still going strong and the containers are as good as new.

PAI[R] – Review Your Expenses

After tracking your expenses for a month, you need to review them and see whether you followed your budget. You can also identify areas that you can improve on. If you accidentally spent too much in certain categories like entertainment or F&B, you need to be extra alert next month and take care not to exceed your budget again.

After this, you can also drill down to individual items to review if there are any purchases that you regret or think that you can do without. This exercise will train you to be more sensitive to what you buy.

You should also adjust your budget accordingly if your budget set is too loose or tight.

Some Tips on Controlling Your Expenses

Here are some tips that I have for controlling your expenses.

Personal Finance

  • Set a budget and stick to it
  • Side aside a sum for debts, bills and necessities before indulging in discretionary expenses. Remember that debt is a guaranteed loss every month.
  • Spend based on the cash you have and not on credit. Exclusions include housing and study loans.
  • Take advantage of credit cards but always pay in full on time
  • Set aside a sum of money and transfer it to a separate bank account for spending purposes
    • This has a small disadvantage where you cannot fully enjoy the interest rates in your main savings account.

Daily Spending

  • Prepare your own food and eat at home
  • Take public transport
  • Cut down on non-essential expenses like bags, shoes, clothes, entertainment
  • Look for free stuff to do like hiking in nature parks, reading books, watching YouTube
  • Buy higher quality items to save money in the long term
  • Manage your monthly subscriptions like Netflix, Spotify, mobile bill, insurance. Cancel them if you do not need them
  • Take note of the latte effect where frequent small expenses every day add up. S$2 a day for a year adds up to $730 that you can direct to your goals.

Digital Marketing

  • Let your purchases be guided by what you need and not be influenced by what merchants show you.
  • Every cent spent on something you do not need is a waste even if the item is dirt cheap.
  • Delete your e-commerce apps and reinstall them only when you need to purchase something
    • The bombarding of notifications can lead you to overspend on things that you do not need
  • Install Adblock and privacy browsers to minimize the effects of marketing and advertising


To manage your expenses and reach your goals, you need to set up a budget and stick to it. You will also need to start tracking your expenses in order to review them. Use a mental checklist like PAIR to evaluate your purchase decisions. If the happiness from making the purchase significantly outweighs the setting back of your goals, go ahead and buy it. Don’t overly torture yourself to reach your goals. By managing your expenses, you not only save money but at the same time save the environment.

If you need someone to talk to about managing your expenses, you can leave a comment or drop me an email at

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