Welcome to my second post in the Managing Your Money series. Now that you’ve taken step 1, making a budget, it’s time to start tracking your expenses.
Why do I need to track my expenses?
To be able to manage your money well, you need to know exactly what you’re spending it on! You’ve probably found yourselves reaching the end of a week or a month and wondering exactly where all your money went. When you start tracking your expenses, you’ll have a better idea of exactly what you’re spending your money on – and where you can cut back to save more!
What’s the best way to track my expenses?
The best way to track your expenses is whatever way works for you. Here are some ideas to get you started:
- Write them down at the end of each day.
- Put everything on debit or credit so you have an online record.
- Keep all your receipts and then enter the amounts in a spreadsheet.
- Use an app to keep track of your spending.
If you start trying to keep track of your expenses one way and it doesn’t work, don’t just give up. Keep trying until you find a method that works for you!
What kind of expenses do I need to track?
The point of tracking your expenses is to get as accurate a picture as possible of what you’re spending your money on. So it’s important to track every single expense!
Here are some sample expenses:
- Common expenses such as a mortgage or rent, utilities, groceries and eating out, gas, and insurance.
- Less common expenses such as home or car repairs, gifts, vacations, and clothes.
- Don’t forget to track things that are auto-deducted such as gym subscriptions, streaming services, or meal-kit delivery.
Tracking all of your expenses will help you get a better handle on where you’re spending your money.
The Takeaway
Tracking your expenses isn’t that exciting – it’s certainly not as much fun as spending your money! But it’s a critical step in helping you get a better handle on how you’re spending your money. Let me know what your biggest surprise was when you started tracking your expenses in the comments!
