April 14, 2019
So you’ve decided to track your spending in 2019. Here are some tips to make the process easy and effective.
Tracking your spending is important to make sure you’re sticking to your budget or using your money wisely. Unfortunately, tracking spending can seem like a giant pain.
The good news is, it doesn’t have to be difficult to keep an eye on where your money is going. In fact, by following these four tips for tracking your spending, you can make the process easier and can streamline your efforts to better monitor your cash flow.
1. Understand your goals for tracking spending
It’s important to understand what you hope to achieve when tracking spending, so you’ll stay motivated and so you can devise a system that works for you. If you’re trying to make a budget for the first time and need to know where your money is going, being very detailed is key so you can find out exactly where you’re overspending.
If you’re simply trying to make sure you’re sticking to an existing budget, you may be able to be a little bit more broad in the spending categories you track depending upon how your budget is designed.
Before you start the process of tracking spending, consider what information you’re trying to get and why. Then when you get tired of writing down your transactions, just remind yourself of your goals so you’ll be more excited to continue your efforts.
2. Record your expenses throughout the day
If you write down your expenses as you make them, it’s much easier to keep track of where your money is going. That way you won’t have a whole bunch of transactions to enter at one time and you won’t have to wrack your brain to know what that $10 charge at the store was for when you look back at your credit card statement a few days later.
3. Devise a system that works for you
There are endless ways to track spending, and some of them will work better for you than others. For example, if you have your phone with you all the time, it may make sense to keep a running tally on your phone of each transaction.
On the other hand, you may not feel comfortable typing out a bunch of stuff on your cell phone so keeping a small notebook in your purse and manually writing down transactions can make more sense.
If you tend to forget to track expenses but you use your credit card all the time, stick a post-it note to the card. Each time you pull it out, you can write down the transaction on the note as the store clerk is running the card.
You’ll also need to decide if you want to use a simple spreadsheet to enter your transactions in, or if you’d prefer to use specialized computer software or a handwritten ledger to keep track of where your money is going.
4. Consider using apps to help make tracking spending easier
When writing down all your transactions is too much trouble, you can consider using an app such as Mint. Mint allows you to link your bank account and credit cards and creates a record of each transaction you make. You can review the transaction history daily and assign categories to the spending you’ve done so the computer will take care of much of the work for you.
If you use apps, just be sure to remember to record any cash transactions you make because those won’t show up on your history. Also make sure all your accounts that you use to spend are linked so you don’t miss anything.
Tracking your spending is worth the effort
Keeping track of where your money is going is a key step in accomplishing your financial goals. By implementing these tips to make the process easier, you can ensure that you stick to your efforts to monitor your expenditures so you can stay on track towards doing big things with your money.
Click to read the original article from The Ascent.