The 3 Buckets Of Expenses (2392)

Are you making smart financial decisions, or just calling your impulses “needs” to feel better about them?

In this episode, Kevin and Alan break down a practical framework for spending with more honesty, discipline, and self-awareness. They unpack why people blur the line between wants and needs, how goals change what actually matters, and why identity, dopamine, and self-deception can quietly sabotage financial progress.

This conversation will help you think more clearly about money, spend with more intention, and make choices that support real peace of mind over temporary relief. Listen before your next “must-have” turns into another lesson.

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Learn more about:
Track the Work. Earn the Results. To know more about the "Next Level Fitness Accountability Group," reach out.

• Kevin: https://www.instagram.com/neverquitkid/
• Alan: https://www.instagram.com/alazaros88/

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NLU is not just a podcast; it’s a gateway to a wealth of resources designed to help you achieve your goals and dreams. From our Next Level Dreamliner to our Group Coaching, we offer a variety of tools and communities to support your personal development journey.

For more information, check out our website and socials using the links below. 👇

Website: http://www.nextleveluniverse.com

Facebook:
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Email:
Kevin@nextleveluniverse.com
Alan@nextleveluniverse.com

LinkedIn:
Kevin: https://www.linkedin.com/in/kevin-palmieri-5b7736160/
Alan: https://www.linkedin.com/in/alanlazarosllc/

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Show notes:
(4:20) Wants, needs, and financial honesty
(5:17) Goals shape what feels necessary
(9:17) Spend in line with your goals
(11:28) Buy back time or make money
(13:28) Dopamine can distort spending
(16:26) Track every expense in three categories
(18:26) Outro

🎙️ Hosted by Kevin Palmieri and Alan Lazaros

Next Level University is a top-ranked daily podcast for dream chasers and self-improvement lovers. With over 2,100 episodes, we help you level up in life, love, health, and wealth one day at a time. Subscribe for real, honest, no-fluff growth every single day.

Transcript

Kevin Palmieri

(0:00) I said to my wife the other day, I said, I am going to get a giant poster of Jason Voorhees to put on my wall in my office. (0:09) For those who don't know, he's the main character from Friday the 13th. (0:12) And then we went and looked on Etsy together.(0:15) I found what I was going to get and then I just didn't buy it because I was like, this is a waste of money and I don't need it right now. (0:21) It would be really cool to have. (0:22) I think it would set the ambiance of the office.(0:25) I bought it today though. (0:27) Oh my goodness.

Alan Lazaros

(0:30) Everyone, if they want to build financial freedom, this is what I just said. (0:35) I just taught a masterclass on this. (0:37) You don't necessarily need that new car, brand new.(0:41) What you do need is peace of mind with your finances.

Kevin Palmieri

(0:45) Welcome to Next Level University. (0:47) I'm your host, Kevin Palmieri. (0:49) And I'm your co-host, Alan Lazarus.(0:52) At NLU, we believe in a heart-driven, but no BS approach to holistic self-improvement for dream chasers.

Alan Lazaros

(0:59) Our goal with every episode is to help you level up your life, love, health, and wealth.

Kevin Palmieri

(1:05) We bring you a new episode every single day on topics like confidence, self-belief, self-worth, self-awareness, relationships, boundaries, consistency, habits, and defining your own unique version of success.

Alan Lazaros

(1:21) Self-improvement, in your pocket, every day, from anywhere, completely free. (1:28) Welcome to Next Level University.

Kevin Palmieri

(1:33) Next Level Nation today for episode number 2,392, The Three Buckets of Expenses. (1:39) I'm in a hotel right now and I said to Alan, I said, hey brother, I need to order food. (1:45) I don't have a choice.(1:46) I worked all day. (1:47) I still have work to do. (1:48) I need to order food.(1:51) And, that's not really true. (1:52) I could have packed my lunch and brought it with me. (1:54) Nice.(1:55) So, I technically don't need it. (1:56) It's really nice to have, but blah, blah, blah. (1:59) Why'd you want to do this episode?

Alan Lazaros

(2:01) It was with a client. (2:03) She said I needed new clothes. (2:05) And I said, nope.(2:08) She's like, no, you don't understand. (2:09) Like, I needed new clothes. (2:11) Like, I had holes in my shirts.(2:12) I said, no one needs new clothes. (2:14) Some people do. (2:15) Some people do need new clothes.(2:17) You don't need new clothes. (2:19) You want new clothes. (2:20) And that's okay.(2:22) It's time to be that honest. (2:25) Listen, we all inflate, deflate, omit, lying, theory. (2:30) Human beings are not fully honest.(2:32) We embellish. (2:33) Like, there's a whole thing. (2:34) I'm not perfect at this.(2:36) I try really hard to be as accurate as possible. (2:38) That's why sometimes Kev's like, well, blah, blah, blah, blah, blah, on the podcast. (2:42) Like, okay, my bad.(2:43) My bad. (2:44) That's my bad.

Kevin Palmieri

(2:44) What? (2:45) I know you want me to call it out. (2:46) Of course I do.(2:47) Of course I do. (2:47) Maybe I'll stop doing it as publicly and I'll wait until we're behind the scenes. (2:50) You don't have to.(2:51) I just thought that was a funny impression of you. (2:54) That was terrible. (2:56) Somebody told me yesterday, they said, you have the best radio voice I've ever heard.(3:01) And I was like, definitely not. (3:02) But thank you. (3:03) I do appreciate that very much.(3:04) Is that your way of telling me I'm ugly? (3:05) If so, I do appreciate that as well. (3:08) Thank you.

Alan Lazaros

(3:08) You have a face for radio. (3:10) That's what I said. (3:10) No, but on with this client, she argued and I encourage the discord.(3:18) As a matter of fact, I got a message, a DM from one of our clients, shout out to Philip, my man, Philip, and he loves it. (3:27) He loves that we debate. (3:29) He thinks it's great.

Kevin Palmieri

(3:30) Okay.

Alan Lazaros

(3:30) Shout out to Philip. (3:31) He also thinks I'm right. (3:33) I'm joking.(3:33) Philip's good peeps.

Kevin Palmieri

(3:34) Well, he is an engineer, so that would track.

Alan Lazaros

(3:36) He actually didn't say that. (3:37) I don't think he said that. (3:38) I haven't finished the audio yet, Philip.(3:39) I'll get back to you soon. (3:40) I'd understand if you take his side, Philip. (3:42) No offense taken.(3:43) But I do think that there's a lot of value in a sort of healthy debate between us because you get closer and closer and closer. (3:54) You understand the whole game instead of just one side.

Kevin Palmieri

(3:57) Yeah. (3:57) When do you need something? (4:00) I'll never forget this.(4:01) Alan and I were at the movies with a mentor and I was sitting next to Alan. (4:04) I was like, what the fuck is that smell? (4:07) It smells like something died in here.(4:08) And we found out it was Alan's shoes. (4:10) Yeah. (4:10) Because he worked out in them.(4:14) He did yard work in them. (4:15) Evidently, he wore them into the water. (4:17) Just whatever.(4:18) Then he got new shoes.

Alan Lazaros

(4:20) Yeah. (4:21) I have a pair of shoes right now. (4:24) When do you know?(4:25) When do you know? (4:27) It's not even that I don't want you to get ... (4:29) It's a spectrum.(4:31) Instead of thinking I need or I don't need, it's a zero to 10. (4:34) It's not a one or a zero. (4:35) It's not a yes or a no.(4:36) I need new shirts. (4:37) No, you don't. (4:38) Your shirts are fine.(4:39) I want new shirts. (4:41) Okay, I have a Model Y Tesla. (4:43) No one needs a Model Y self-driving car.(4:46) No one needs that. (4:48) We wanted that. (4:49) It's just when you're honest with yourself, I think life gets really shitty when you tell yourself all these delusional stories.(4:57) I told this to my client. (4:59) I said, we don't need a new house. (5:01) Our house is great.(5:03) We're going to get one because we want one. (5:06) No one needs a new house. (5:07) Some people do, but we don't need a new house.

Kevin Palmieri

(5:10) This house is great. (5:11) What's the measurement? (5:13) When the circumstance is below what?

Alan Lazaros

(5:17) It's an optimal stopping problem based on where you're at in life in three categories, fitness, finance, and family. (5:26) We're going to build a family, Emily and I. (5:29) Do we need a new house because we don't have enough bedrooms?(5:33) No. (5:34) We could not have our own solo offices. (5:38) Of course, we could easily have kids and have them share a room, but we don't want to do that.(5:48) The three categories are must have, food, water, shelter. (5:55) Beyond that, you're telling yourself a fucking story. (5:57) That's my truth.(6:00) Number two, nice to have. (6:02) Most things fall into this bucket. (6:04) A Model Y is nice to have.(6:07) I need a vehicle, quote unquote. (6:10) You don't really. (6:10) You can walk, but we need a vehicle, quote unquote.(6:16) It's nice to have a Model Y. (6:18) I could just get a shitbox. (6:20) I did for a long time.

Kevin Palmieri

(6:22) You do need a car though. (6:24) No, you don't. (6:25) If you want to facilitate wealth creation and you want to work at a place that is not within a walking distance.

Alan Lazaros

(6:32) Yes, but those are all ifs. (6:34) Well, so circumstances, right? (6:36) Yeah, circumstances, but oxygen is not a circumstance.(6:38) You need oxygen. (6:38) No, you're fucked with that. (6:40) You need Wi-Fi.(6:42) If I want to be a successful business owner, then yes, I need Wi-Fi. (6:47) Based on your current circumstances, you need Wi-Fi. (6:50) No, based on my goals, I need Wi-Fi.

Kevin Palmieri

(6:53) Based on your goals. (6:54) Yep. (6:55) Okay.(6:56) I would say your circumstances right now are a result of your goals.

Alan Lazaros

(7:00) Yeah, it is. (7:01) It is. (7:01) Okay.(7:02) But if you took away my goals, I wouldn't need Wi-Fi. (7:04) Yeah. (7:05) And I think this is a deep layer of thinking.(7:06) It's not, it's not normal. (7:08) I'm very alone in this, unfortunately, but I don't need books, man. (7:14) I want books.(7:17) But you need them for the goal. (7:18) I need clean water. (7:19) I need some form of a shelter.(7:23) I've had some bad ones. (7:25) I've also had some really good ones. (7:27) And I need food.(7:30) And I need some level of belonging and companionship. (7:34) But dude, that's the cool part about being successful. (7:37) You don't actually need to be successful.(7:39) I think people tell themselves a story they do. (7:42) They tie their identity to it, and then they're trapped by it. (7:44) You and I could never have quit our six-figure jobs if we weren't willing to go back to zero.(7:50) And again, we didn't technically go back to zero. (7:52) You had money. (7:52) I had money saved.(7:54) I went way past zero. (7:56) Yeah, we went past zero. (7:57) But when you left your job, you had some money.(7:59) The point is, it's more conducive to building when you don't tell yourself a story about things. (8:09) Now, do I need new shoes? (8:11) I definitely did then, but that would be probably a must-have if I wanted friends.(8:20) But that's the thing. (8:21) This gets really dicey. (8:22) So here's what I would say to everybody.(8:24) Try your best. (8:25) Have you ever heard the saying, and you might not even like this saying, but I do, you will only ever be as successful as you are, honest with yourself. (8:36) No, I like that.(8:38) Okay, you do. (8:39) Some people are like, oh, I need new shoes. (8:41) It's like, no, you don't.(8:42) And you can only reach a certain level. (8:44) There are certain clients who are like, I'll get rid of my car if I have to. (8:47) I was like, you're going to win.(8:48) You're going to win. (8:49) Why? (8:50) Let's unpack it.(8:51) If you're willing to sacrifice at that level, I know that this level is now possible for you. (8:56) When you needed nice things, dude, you were screwed.

Kevin Palmieri

(8:59) I had somebody the other day, they're like, when are you going to buy new golf clubs? (9:02) I was like, these are great. (9:03) They were free.(9:05) Unless you're a professional golfer, not right away. (9:08) I was like, I'll use these until I have so much money where I can just not think about it. (9:14) But even then I probably won't care.(9:16) They work fine.

Alan Lazaros

(9:17) Right. (9:18) But now let's do this. (9:20) The microphone in your hand was 90 bucks, right?

Kevin Palmieri

(9:23) Back in the day, yeah. (9:24) No, I think it was like $70.

Alan Lazaros

(9:25) This is the old audio technica. (9:28) All right. (9:29) Hopefully as a podcaster, Kevin considers a new microphone for when he travels a higher priority than new golf clubs.(9:38) Why? (9:39) Because his goals are not golf. (9:43) They are business.(9:46) This is why I think I get so frustrated. (9:50) If you don't have goals, you don't know what is and isn't optimal. (9:54) We did decision making on the last episode.(9:57) Must have, nice to have, don't fucking need are the three categories that I have my clients using. (10:05) So whenever they track their finances, they have a dropdown in Google Sheets. (10:11) Must have, nice to have, don't fucking need.(10:14) And you don't have to put fucking if you don't want to. (10:16) I think it's cool to emphasize it. (10:17) Like you don't need that.(10:19) No one does. (10:19) You didn't need that poster. (10:21) You don't.(10:22) Oh no, I want that poster.

Kevin Palmieri

(10:24) And honestly, that's the thing is like for some reason, if I want something and I just like let it simmer for a few hours, I just don't want it anymore for a while.

Alan Lazaros

(10:34) I'm getting new, uh, I never used to have facial hair and now I do. (10:39) And it's actually, it, it immediately doesn't like that it pokes her.

Kevin Palmieri

(10:43) Yeah, no, it's not a, again, you know, just like being jacked. (10:48) You think it's going to attract all the women. (10:51) No, same with facial hair.(10:52) I was like, I want to get some facial hair. (10:53) No, it's terrible. (10:54) My wife hates it, right?

Alan Lazaros

(10:56) God, some girls like it, but if it gets too much, it pokes her and she doesn't like it. (11:01) So I have to keep it at a certain, I don't have to do anything. (11:03) I choose to keep it at a certain thing.(11:05) And, uh, I know we got to get out of here. (11:07) The one that I want is 150 bucks for the whole kit, manscaping the whole thing. (11:12) And I'm like, nope, no, I'm going to use this one I have.(11:17) And eventually it'll cross a chasm where that is optimal, more optimal. (11:24) But this is the key. (11:26) And I think that this is the mindset.(11:28) Am I buying this because it's going to save me time or make me money? (11:32) And remember the things that save you time, make you money, assuming you're working, you're a hardworking individual. (11:38) Yeah.(11:38) So you can crunch the numbers on this. (11:41) If it saves me five minutes a day, times 365 days a year. (11:46) And this is actually how I think I've crunched this five times 65 divided by 60, that's 30 hours.(11:52) Damn. (11:52) So it is actually dumb for me not to do that. (11:55) If it's going to save me five minutes, I actually don't think it will.(11:57) Although the one I'm, I have is like pretty bad. (12:00) So it's going to happen. (12:02) I don't like to invest money in things that don't make money or buy back time.(12:08) I don't like the nice to have bullshit. (12:11) That's not for me. (12:12) Now that said, why are you getting a new home?(12:16) Right. (12:16) There's a lot of utility. (12:17) I want a home gym.(12:18) That's another one. (12:19) I, no one needs a home gym. (12:21) No, like, unless you live in the really far from a gym or whatever, like at the end of the day, all I care about is engineers.(12:28) I learned when I was very young, that when a girl says, do I look fat in this? (12:32) You can't say yes at level six out of 10. (12:33) Like that's not how the social world works.(12:36) You can't be that honest, unfortunately, because you hurt people's feelings when it comes to you and your own finances. (12:42) Don't lie. (12:43) Don't tell yourself a story.(12:44) You don't need half the shit you buy. (12:46) And by the way, the world wants you to believe you need it. (12:51) Every commercial is, Hey, by the way, have you realized that you could have a brand new deck with none of it?(12:57) None of it's real. (12:59) You don't need to watch avatar. (13:01) You want to.

Kevin Palmieri

(13:02) So yes, I buy it. (13:04) The more you buy it, the more you think you need it. (13:06) That's the problem.(13:07) I know. (13:08) That's how they get you though. (13:09) Well, no, even, even outside of that, right.(13:12) I don't see, I don't watch TV, that TV with ads, I guess I do, but like, I don't watch cable. (13:17) So I don't see ads for Starbucks, but dude, when I go to Starbucks and I get it, I'm like, oh fuck. (13:22) Yeah.(13:22) All right. (13:23) I need that the next day. (13:24) I don't really.(13:25) Yeah. (13:25) Yeah. (13:25) Yeah.(13:26) Yeah. (13:26) Yeah. (13:26) Well, that's the dope mean thing.

Alan Lazaros

(13:28) Yeah. (13:28) You wanted to do an episode on this because you knew we wouldn't have time, but you, you, when you tie dopamine to buying things, it's very dangerous.

Kevin Palmieri

(13:39) I saw a really cool post the other day and it's like, this is a fine line. (13:43) They said, monetize what you get dopamine from. (13:45) And I was like, that's interesting.(13:46) Now. (13:47) Yes. (13:47) And yeah, but like you can get dopamine from dopamine from, from negative things.(13:53) So you probably shouldn't make a career out of doing drugs. (13:55) Like that's probably not ideal, but I tie my dopamine to coaching.

Alan Lazaros

(14:02) I think I, I don't know. (14:04) Podcasting you do for sure. (14:05) For sure.

Kevin Palmieri

(14:06) But I'm sure there's a bunch of other things. (14:08) Without a question, dude, I am, something's happening to me. (14:12) I'm back.

Alan Lazaros

(14:13) I don't, I'm like hooked. (14:15) I remember when I argued with you, I know we got to go. (14:17) I said, dude, the gym is painful.(14:19) You're like, nah, feels good. (14:20) I'm like, oh, you have really rewired. (14:23) Wow.(14:23) Either that or your workouts are fucking. (14:25) I had a great good, but I've seen you work out there. (14:27) They're good.(14:28) I like it.

Kevin Palmieri

(14:29) Yeah.

Alan Lazaros

(14:29) You like it. (14:30) You've learned to like it.

Kevin Palmieri

(14:31) I had a moment today. (14:32) I'm not going to do it because this would lead to a divorce and very unsuccessful business. (14:36) But I was like, I'm going to do another show.(14:38) Oh, I'm not going to, but I had a moment where I was like, I want to find something. (14:42) It was an after the rap video when you're like, well, if I have the kid rapping, I'm honestly, I thought it was unrelated, but that might be exactly why it might be exactly nothing's unrelated, man.

Alan Lazaros

(14:52) It's good stuff. (14:53) And by the way, I love the 10 pound and 10 a week challenge. (14:57) That's like our new fitness shows.(14:59) I know it's not even close to the same thing, but it's nice to have goals that are, that matter in that way again. (15:05) And I tie my right now to the scale going down for sure. (15:09) I, that's an episode we'll do another time.(15:11) Molecule of more tie your dopamine to progress in the things that you value.

Kevin Palmieri

(15:18) You have to do a reading and, or a 20 minute, you know, they do like 20 minute book reviews. (15:24) I'll have to do it. (15:24) I've never read the book, so I want to make sure I come correct.

Alan Lazaros

(15:27) Oh yeah. (15:28) Sounds good. (15:28) I mean, I'm going to make sure the idea though, it's just the idea is dopamine.(15:33) What you tie your dopamine and self-esteem to you most likely do a lot. (15:37) Like for me shopping, some people shop all the time and I try really hard not to tie dopamine. (15:44) Like when you spend money, you shouldn't don't feel good about it.(15:47) Don't feel good about it. (15:49) Let yourself feel bad about it. (15:51) People, that's an episode we should do.(15:53) I watch very closely what my clients tie feeling good to. (15:59) Cause if you feel really good when you spend money, you have to be very careful. (16:03) Or if you feel really good, when you take a day off, you gotta be really careful because, and again, it's all fine.(16:10) If you don't have goals, if you don't have goals, do whatever you want. (16:12) But if you have big goals, you cannot tie pleasure and dopamine and good feelings and high self-esteem to the thing that's in the opposite direction. (16:22) Makes sense.

Kevin Palmieri

(16:23) All right. (16:23) What's the takeaway? (16:25) What's the lesson here?

Alan Lazaros

(16:26) That's it. (16:27) Track your finances. (16:29) Put it in one of three categories.(16:30) Green, yellow, red. (16:31) Must have. (16:33) Nice to have.(16:34) Don't fucking need.

Kevin Palmieri

(16:36) I second that. (16:37) I am not doing that, but I will start that for sure. (16:40) Nice.(16:40) I'm always thinking of that because Alan has conditioned me over the last however many years to like be hyper-focused on that. (16:48) So I'm definitely conditioned that way.

Alan Lazaros

(16:50) And it's better now, right? (16:50) Peace of mind.

Kevin Palmieri

(16:52) It's worse in the discipline way. (16:55) Worse on the day-to-day, better in life. (16:56) Far better.(16:57) Far better. (16:58) I would rather be disciplined and create a gap of progress than be not disciplined and close the gap of progress and then it go to detriment for sure. (17:08) For sure.(17:09) Okay. (17:10) If you're, sorry, go ahead. (17:11) No, that's it.(17:12) That's good. (17:12) If you're looking for help in this department, Alan can help you. (17:17) Alan is the numbers guy.(17:18) He knows numbers. (17:19) All money is at the end of the day is numbers and how you accumulate it and where it goes and all that stuff. (17:24) So reach out to Alan and then shout out to the Next Level Fitness Accountability Group.(17:28) If you're trying to get in the best shape ever, in the best shape recently, you want to get reinvigorated when it comes to fitness, whatever it is, we are in there every single day. (17:37) I'm posting shirtless pictures in there. (17:40) I'm not saying you should do that, but we're leading the group and we love fitness.(17:46) And we're creating a group that, yeah, we want it. (17:50) Like that's what this group is. (17:51) This is a group that we want to be a part of and we want to lead.(17:53) And if you're into that, we want you to be a part of it too.

Alan Lazaros

(17:56) Yeah. (17:56) And the group, quite frankly, will have you feeling bad if you're letting yourself down and not exercising. (18:02) It'll have you feeling good when you do.(18:04) That's by design. (18:06) No one's going to shame you. (18:07) It's all respectful, but don't get it twisted.(18:09) If you're in there, you're going to see everybody working out and you're going to... (18:13) I've been there before. (18:14) When you're not working out and everyone else is, it feels like shit.(18:17) And that hopefully will keep your ass in gear by design. (18:20) So all respect and reach out to Kevin or myself on Instagram DM if you want in.

Kevin Palmieri

(18:26) As always, we love you. (18:27) We appreciate you. (18:28) Grateful for each and every one of you.(18:29) And if you are as committed as you say you are to getting to the next level, make sure you tune in tomorrow because we will be here every single day to help you get there. (18:36) Keep leveling up to reach your full potential.

Alan Lazaros

(18:39) Next Level Nation.

Kevin Palmieri

(18:41) Thanks for joining us for another episode of Next Level University. (18:45) We love connecting with the Next Level family.

Alan Lazaros

(18:48) We mean it when we say family. (18:50) If you ever need anything, please reach out to us directly. (18:53) Everything you need to get ahold of us is in the show notes.(18:57) Thank you again, and we will talk to you tomorrow.