2021 is the year we’re levelling up financially but, you can’t get there without properly monitoring how much you spend. Tracking your spending regularly can give a clear picture of where your money goes and help you plan where you’d like it to go instead.
Here are 4 easy ways you can start tracking your monthly expenses.
Pencil and Paper
Yes, this is the digital age but, that doesn’t mean there aren’t any benefits to using pencil and paper. Plenty of people have stick to a paper budget. The biggest benefit here (besides not needing access to technology) is that physically writing things down requires an active brain. Active brains are quite helpful when you’re dealing with money.
Envelope System
Tracking with pencil and paper, not for you? No problem, you can try the envelope system instead. Here’s how it works, at the start of the month (most likely after you’ve gotten your salary), you put specific amounts of cash in envelopes (or jars, depends on what you have available) then label them. You can include a sheet of paper detailing how you should spend the money in each envelope. Groceries, entertainment and eating out are three great examples. Take your “eating out” envelope with you when you’re going out for dinner. When the envelope is empty, your spending stops. Your money is essentially tracking itself.
Computer Spreadsheets
It’s time to talk digital. This is one is for spreadsheet lovers. Spreadsheets provide you with plenty of templates, the ability to customize your budget, the simplicity of having the math done for you on the screen and so much more! As long as you remember to update your budgeting spreadsheet daily with your expenses, using a spreadsheet can be amazing.
Budgeting Apps
If you’re looking for a more low maintenance way of tracking expenses, Budgeting apps are where it’s at. Reach is a good app to get started. The app tracks your bank SMS automatically, doing all the heavy lifting you so there’s no need for complicated excel sheets. You can also manually enter your expenses if you don’t receive SMS transaction alerts from your bank.
No matter what expense tracking system you use, what’s important is that you track as you go so you don’t miss any transactions. Let us know which of these systems you plan on using? Found any of these tips useful? Share with friends
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