Keeping Track of Our Money
Take 10 minutes at the end of each day and record what you spent. Use a notebook or your favorite app and track it. Over time, you start to see patterns. You learn things you didn’t know about yourself in terms of what your spending says about your priorities. That will naturally lead to change.
One of the reasons I focus on spending is that people think tracking doesn’t help. A great (or not so great) example is the time I taught a financial literacy class to people who were working their way out of the local homeless shelter. The first week, 20 people would show up. I gave them a pocket-size spiral notebook and asked them to record everything they spent for one week and to come back so we could move onto the next step. No one ever came back. After a few weeks, we canceled the class.
In the Bucks blog, Carl Richards says we can learn a lot about ourselves and make improvements when we track our spending (although he argues that people don’t track their spending because they think it doesn’t help, whereas I think people don’t track their spending because it’s tedious and they just don’t want to do it).
For people who don’t like to track their spending, Richards says the best thing they can do is to track one number every week (i.e. how much they’re saving every week), which means you’re already ahead of the game if you do our weekend and monthly check-ins. Our own Amanda Tomas has learned via her own monthly column to cut down on how much she spends at the grocery store to help her get her savings goal on track. It’s also a lot more fun to track what we spend, save, and pay off when there’s an amazing community around to offer encouragement (thanks everyone).
Support The Billfold