Friday, July 6, 2012
I started tracking my own personal expenses in college and have continued to do so to this day. It has assisted me in all sorts of ways when it comes to saving money and making my dollars go further.
Step #1 – Selecting a Method
Initially, I tracked my expenses in college in a notebook, on a single sheet of paper. Eventually, I moved my tracking into an expense ledger, and later still onto a spreadsheet, but in all cases, it was done in a method that was most conducive to actually doing it and that made it as simple for me as possible.
Step #2 – Making it Consistent
Tracking expenses is one of those things that is typically most beneficial when you make it consistent. Tracking only certain expenses or at certain times can provide some input on where money is going, but it might not show the whole picture.
I’ve tracked every penny, every day for the last 15 years, and it’s amazing the amount of information I’ve been able to pull from this spending history. Staying consistent with my tracking has also allowed me to make it habitual, which takes some of the work out of the process.
Step #3 – Pooling Data
Step #4 – Pulling Data
Step #5 – Making Adjustments