4 ways to keep track of your spending

Keeping track of your spending is SOOOOO important when it comes to budgeting.  Let me repeat that.  KEEPING TRACK OF YOUR SPENDING IS SOOOOO IMPORTANT WHEN IT COMES TO BUDGETING!  Whether you like it or not, you need to have some way to keep track of that spending!  This post will show you some different ways to keep track of your spending.  Some ways are easier than others, but hopefully everyone will be able to find a way that works for them!

#1 Keep your receipts

My mom is a fan of this method.  She keeps ALLLLLLL her receipts.  Every single one of them!  I helped her make a budget on a spread sheet and when she has time, she will take her receipts and enter them into her spreadsheet.

Pros:

  • Easy
  • Quick
  • Accurate record keeping
  • Easy proof of purchase

Cons:

  • CLUTTERED! (I hate receipts for that reason, so I don’t use this method)
  • Easy to lose
  • Not eco-friendly (I opt to not have receipts or bills sent to my email as much as I can to hopefully diminish my carbon foot print)

I personally would not recommend this way, because although my mom does save her receipts, she’s not very consistent with adding them up (Sorry mom!  I still love you!).  Simply saving receipts and letting them pile up in your purse or wherever is not enough.  You still need to record them somewhere and add them up to make sure you’re staying within your budget and not overspending!

#2 Keep a spending tracker journal

My mother in law uses this method and it works really well for her!  She carries a small notebook in her purse, and whenever she makes a purchase she pulls it out and records it!

Pros:

  • Not Cluttered, everything is in one place
  • Quick
  • Accurate
  • Useful when you’re someplace that doesn’t give a receipt (garage sales, concession stands)

Cons:

  • Takes a little more time (by time I mean about 30 extra seconds of your day)
  • Can be easy to lose
  • Takes more discipline (to make sure you’re actually recording EVERY purchase)

I would definitely recommend this for beginners, people who consistently use cash, and people who are trying to not use their credit card.  Make sure to record the date, place, category or item purchased, and the price.  *tip: have a lot of errands to run?  Write the date, every place you plan to go for the day, and what you’re going for, then after you make the purchase, all you have to do is record the amount*  When you’re running out and about, this can help save time because it takes all of about 5 seconds to write a price in a notebook.

#3 Credit card/Bank statements

This is the method my husband and I use.  We are VERY DISCIPLINED with our spending.  So we do use our credit card for every purchase, but WE NEVER SPEND OVER OUR MONTHLY BUDGETED AMOUNT!  Then WE PAY OFF OUR PURCHASES WEEKLY!  Our bank has an App, and all of our purchases show up instantly in that App.  Usually at the end of the week I’ll look at our statement, record the amounts into our master budget then pay the purchases we made that week.

Pros:

  • Quick
  • Easy
  • Accurate
  • Earn points on our credit card through purchases
  • Eco-friendly

Cons:

  • Takes a lot of discipline when swiping the credit card
  • Can be tempting to spend a little more than you have budgeted
  • Can create debt if purchases are not immediately paid

I would recommend this method only for those who have been budgeting and are disciplined in spending.  It’s useful because you basically get a little free money by taking advantage of a point or percentage system that a lot of different credit cards offer.  However, if you are tempted to spend more, simply because you are swiping a credit card, DO NOT USE THIS METHOD!  Before we go grocery shopping, my husband and I look at our budgeted amount, and keep track of what we purchase with the calculater on our phone while we shop.  This helps us to make sure we don’t go over our budgeted amount.  Then, when we begin to reach our limit we stop!  At the end of the weak, we know we didn’t overspend, so we can easily pay off what we did spend.  If you are easily susceptible to credit card debt, then put away those credit cards and CHOOSE A DIFFFERENT METHOD!

#4 Envelop Method

My mom and step dad are also a fan of this method, because they like to use cash as much as they can.  With the envelope method, you can simply (1) cash your paychecks, (2) Grab a file folder, or envelopes and keep them in a safe place (3) label each section of the file folder or envelope after your budgeting categories, so you should have an envelope for groceries, gas money, or whatever category you created! Check out my post budgeting 101 to understand exactly what I mean by budgeting categories.  (4) When you spend money, you take it out of the corresponding envelope and when the money is gone, then it’s gone!  Put those credit and debit cards away (Especially if you are prone to overspend).

Pros:

  • Do not need to keep receipts
  • Do not need to physically record purchases
  • Easy
  • Teaches disciplined spending

Cons:

  • Cash is easier to steal
  • A little more unsafe to carry around a lot of cash

I would recommend this method for teenagers, college students, young adults, or older adults who are not disciplined with their spending!  This is a good method because it does not allow someone to go into debt!  You are forced to be smart with your spending, because once you’re out of cash, you’re out luck!  This method really does not require much tracking of spending, it just requires counting cash.

Those are all the different methods that I have had experience with!  Hopefully you can find a way that works for you!  Do you have another method that you use?  Let me know in the comments below!

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