expense tracking for dummies.

School doesn’t teach you how to live. When I graduated from high school I barely knew how to cook, I had never done my own laundry, I had no idea how to take out loans, and I didn’t know what a “lease” actually was. When I graduated from college I still didn’t know how to do my taxes, what repaying my loans would actually look like, or how to set a budget – at least now I know how to cook and do my own laundry…MjAxMy0zN2NlNDhlZTgyZjhjN2Qz_523341a6a9402_rc

My point is: for those of us graduating and getting thrown haphazardly into “real-life” there’s a lot of learning curves.

I still don’t really keep a budget, but I do have a very useful habit of tracking what I purchase. This habit has allowed me to actually save money while working at a farm for most of my time since graduation.

In high school I got frustrated by how I seemingly wasn’t saving any of my hard-earned money. My mom suggested I keep a notebook with two columns – column 1: what you’ve spent, column 2: what you’ve earned. I carried a notebook around with me for a month and at the end of the month I tallied each column up, calculating the difference.

I was astounded, and also disgusted with myself. The accumulated lists showed me how much needless money I was wasting through unhealthy snacks, unnecessary driving, and random shopping sprees. I could no long live “out of wallet, out of mind” – my habits were clearly wasteful. I started saving immediately.

I picked the habit back up after graduation. I find my method more informative than trying to ballpark a budget – I can base my future financial decisions on my ACTUAL spending habits. I know when I can afford to go out to eat, how much I’m actually paying on loans, how gas fluctuations impact my income, how much I have to pay off my credit card, and most importantly, how I can intervene to save more next month. And it’s easy. It’s super easy. You are no longer allowed to be afraid of budgeting because this is so damn easy.

So here is a made up example using Excel.
I like Excel because you can automatically add and subtract things, but a notebook would work too.

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TRICK: To create automatic totals enter the equation “=SUM(“, highlight the column you want to add, and close with “)”. For this example box B25 contains “=SUM(B5:B24)“. Easy if you’ve ever used Excel, but not everyone has.

So. Based on the calculations this person (we’ll call her Suzie) is losing 30 dollars a month. Not great. But take a quick look at her expenditures. If Suzie wants to start saving money it won’t be hard. Here’s a few ideas for her:

  • Skip on the expensive concert: there’s so much free music around! Look for something local.
  • $40 on a T-Shirt!? Go check out salvation army.
  • Eat at Home: You’re spending all of your babysitting money on going out to eat, consider having your friends over to make meals every once in a while.
  • Expensive One-timers: In the month of January you both took a trip to NY and bought an expensive new phone – spread these events out over the months to lessen the impact on your budget.

It kind of looks like I’m telling Suzie to have no fun – but that’s absolutely not my point. If she did just ONE of these things she’d be saving a few hundred dollars every month, leaving her room to have fun in other ways.

It’s important to note that even though she’s used her credit cards Suzie has enough money to pay off her credit cards every month, keeping her credit score high and her interest low.

Suzie has loans and rent to pay, and her job doesn’t pay that much. By tracking her expenses and seeing where she can save, however, she can begin to save money, have fun, and stay out of credit card debt.

This is an extremely simple way of tracking expenses and savings in order to budget from month to month. It might seem so simple that you’re wondering why I’m even covering it, maybe you’re already budgeting with a system that makes this look pathetic. Yet, it would amaze you how many people don’t do this – people who track their expenses “in their head” or through their credit card statements.

If you’re one of those people I urge you to try this for at least one month – Just the simple act of needing to remember long enough to write down what you bought makes you more aware of your habits. Awareness is the first step to change.

If you’re not one of those people, if you are already tracking your life’s expenses, how do you do it? Comment below!


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  1. Jeff Benedek

    That’s a good idea! I always thought doing this stuff would be more complicated, but that’s really all you need to know at first. what’s coming in and what’s going out.

  2. I am obsessed with Excel spreadsheets. :)

  3. Dorothy Bowie

    Glad to know that your mom’s idea set you off on a path to financial success…eventually! :-) It really is as simple as you describe.

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