How To Track Your Spending
Ways to keep track of your spending
Are you one of those people who keeps spending money until they run out, leaving yourself to claw your way to the next payday? If so, you should learn how to track your spending. Financial planning experts are unanimous in their agreement that people who keep track of spending are more likely to become wealthy in the future. Tracking your daily spending is a good habit to get into, and will promote a lifetime of financial responsibility.
Many who keep track of spending closely say that it gives them power over money. It helps them view money as a tool, something that they control -- not something that controls them. Tracking expenses will also show you how to save money, as you will gain a great deal of insight into your spending habits.
Manage Your Money: Track Your Monthly Spending
The easiest way to track your spending is to keep all your receipts, then use a spreadsheet to keep tabs on how much money you're spending and what you're spending it on. This method makes it easy for you to tally up total expenses, classify your expenditures by category and calculate ways to save.
There are also those who advocate keeping track of absolutely every single thing you buy. Whether you spend some loose change buying a chocolate bar or drop a couple hundred dollars on a new pair of shoes, write it down in a notebook. Review your purchases monthly and create a chart that shows how much money you're spending on each of the three major expense categories (fixed living expenses, variable living expenses and luxuries). Your goal is to reduce or eliminate unnecessary expenditure so you have more money to save or use to pay off your credit cards or other debts.
If you opt for the latter method, find time every day to sit down and tally up how much money you've spent. This helps you stay on budget and prevents you from suddenly finding yourself behind the 8-ball, as you will know very quickly whether or not you've spent too much and can take immediate and proactive measures to be sure you don't go over your monthly budget.