Do you have a spending journal? Or how do you keep track of your money? Many people have different ways of how they like to manage their finances. Everything from the pen and paper method to excel spreadsheets or even mobile apps are all different methods we commonly hear about. But because there is always money flowing in and out of numerous cards and accounts, it is about finding the method that works best for you. We give you a few reasons why keeping a spending journal can help monitor your funds and simplify your spending.
If you’ve never had a spending journal before, finding a method that will work for you is the first step you need to take. We’ve previously talked about mobile apps that can help you stay on budget by adding your accounts and tracking your purchases. We are finding this is becoming a more popular way of monitoring spending as it is more common now for people to always have their mobile devices readily available. If you haven’t monitored your spending before, start simple. Working in day-by-day or weekly intervals to get the feel for what tracking method suits you best. Try different things! You never know how an app or a pen and paper can help you save money without any hassle.
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Where is Your Money Going?
Large purchases and big lump sums are the expenses we tend to remember. But it is smaller items such as your daily Starbucks coffee that are the ones to cost us. It is tracking these daily or smaller purchases to make sure we aren’t forgetting about them, but also are the ones to add up more quickly. After one week it may not seem like you’ve spent a lot of money, but if you purchase that coffee every day for 52 weeks it will definitely add up to a surprising amount. And it is seeing that total number at the end of the year after tracking your spending that people see where their money is really going and how to change those spending habits to save more in the future.
Photograph via Pixbay
By being able to identify where your money is going, you will then be able to hold yourself accountable for future purchases. Keeping a spending journal will allow you to get a concise picture of how your money is currently being spent and how easy purchases can add up. By having this visual, you will be able to see where you can cut back and start to save when it comes time to create a budget.
Do you keep a spending journal? What method works best for you? Is it a mobile app? An excel tracking sheet? We want to know what you’ve learned about your spending through monitoring your finances. Let us know in the comments below.