If you are not tracking your income and expenses, you can’t manage your money effectively. To do better with money track your spending.
Tracking your spending, on the surface, appears to be straightforward and simple, but it can be a complex process and quite difficult.
It takes consistency to track your spending which is the hard part. And tracking your spending can be overwhelming.
To deal with this difficulty I tell clients to get into the habit of consistently recording your expenses. Use can use any type of log or spreadsheet, even your phone, to record expenses.
Whatever you use as your log, even if it’s a piece of paper, every time you receive money, you should record it in your log.
Whether it’s from a paycheck or gambling winnings, record it in the log. And every time you spend money, whether it is a bill or that cup of morning coffee, record it.
Track Your Spending Every time, every time, every time!
Tracking your spending makes your spending more real. You will begin to see it. You will see it come in and go out and begin to see it as a tool to help you reach financial goals.
It will give you a sense of control.
Your awareness of your money and your behavior with money will sharpen, allowing you to make changes which will improve your financial situation.
This is an important money skill.
Here are a few tips to help you in tracking your spending:
- Make it a routine. Once you get into the habit of tracking your spending, I promise, it will get easier. Always, do what works for you. No one system or way is perfect for everybody. The important thing is to track your spending. How you do 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 where you can spend money and not get a receipt. If they do not give you one, ask for one. Additionally, make it a habit of putting all your receipts in one place so that you do not forget where they are.
- 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 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 you spend.
It will make you think more about each purchase, and you will begin to see if your purchases line up with your values. This 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 exist. 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 your spending? Share your thoughts and subscribe to the GoldenRules Blog and learn how to create a winning spending plan for you and your family.
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