It is important to track the money you spend on a regular basis. Daily, weekly, monthly and also yearly. Tracking your spending will make sure you are aware of overspending and where you can cut back to keep from overspending in the future. Here are some helpful tips to properly track how much money you are spending and where you are spending it.
- Create a Budget: You won’t be able to track your spending without a strict, set budget. It is important to at least have a monthly budget but if that is a little too broad you can also set a weekly budget for yourself. Write down your monthly income and then write out the necessities you need to pay for every month such as food, mortgage/rent, utilities, transportation, etc. Once those are added up, subtract that amount from your monthly income and that is how much spending money you have for the month. Remember, it is also important to put some of that into savings as well!
- Record your Expenses: This is crucial to do every day. Yes, every single day. You don’t want to miss any little amount because each dollar amount counts towards your budget. Whether you write down your expenses on a note pad, in your phone, computer spreadsheets, or a budgeting app, make sure you are tracking of the amount of money you have left to spend to make sure you are not overspending your budget.
- Watch your Amounts: Writing down your expenses is only the first step. You also need to keep a close eye on them to know how much money you have left to spend before you hit your budget. If you are married, make sure that both of you are recording everything and checking in with each other before you spend. Budgets are blown when your household doesn’t track AND watch your expenses.
If you are not actively watching where your money is going, you will always be wondering where your money went. When you set yourself up with the right system, you’ll be completely aware of your expenses and what you can afford or not afford. It is also important to have your whole household on board because if just one person is doing it, then it’s just a waste of time! Be on top of your money and know where it is going to make your life so much easier!