If you want to manage money better, it helps to know where you are spending your money and where it’s going. One way to do this is to track spending.
Tracking your spending, on the surface, appears to be pretty simple, but it can be a complex process and quite difficult.
That is because it takes consistency to track your spending effectively and in a way that helps you manage your money.
Below are several tips to help you track your spending and manage your money better.
• Make it a routine. Once you get into the habit of tracking your spending, it will become easier. And always, do what works for you. No one system is perfect for everybody. So, maybe you track your spending Monday after work or Tuesdays, before work, or maybe Sunday after church. Weekly, sit down with all your receipts or bank statements and record how much you spent, where you spent the money, and what for. For example, I spent $1.18 at McDonalds for a sausage biscuit. The important thing is to track your spending. How you do this is up to you!
• Be more careful with transactions that are easily forgotten. Some transactions, online transactions, transactions without a receipt, can be quickly forgotten. Take special steps to remember these.
• Get a receipt for everything. There are not too many places that will not give you a receipt. If they do not give you one, ask for one. Additionally, if you are keeping receipts, make it a habit of putting all your receipts in one place so that you know where to find them and do not forget where you put them.
• It is best to record your transactions daily. Although you can track expenses once a week, you may find this hard to do. By tracking expenses daily, you do not run into the consistency problems that you would by tracking them weekly, such as I can’t remember a transaction or can’t find a receipt, etc.
Recording expenses will make you more connected to what and where you spend.
Tracking your spending will make you think more about each purchase and may help you to keep unnecessary spending under control.
Tracking your spending is a rewarding process.
It will paint a picture of your spending habits as they exist and not as you think they are. You can then use this information to create a spending plan, or, at the least, to serve as a picture of where your money actually goes.
How do you track spending? Share your thoughts and subscribe to the GoldenRules Blog here, and learn how to create a winning spending plan for you and your family.