Tracking your expenses (Budgeting 201)
I’ve laid out my basic budgeting system before. It’s a simple, workable strategy that keeps me living within my means and saving money every month without driving me crazy with numbers constantly dancing around in my head and occupying my attention.
That’s budgeting 101, and if you want to stay there, it’s enough.
But if you want to do more, let’s talk about budgeting 201: Tracking all your expenses — and I mean all of them. I don’t use anything fancy for this, just a simple Excel spreadsheet. I have columns for things like the amount of the expense, how I spent it (cash? which credit card? bank transfer? paypal? whatever), what I spent it on, the broader category (clothing, medical, pets, entertainment, etc), and any special notes.
Does this sound like a lot of work? Because it’s actually not! Once you have the columns laid out the way you want them, adding any individual expense takes literally a matter of seconds, especially if I enter these expenses as they happen (i.e., don’t let three months of receipts pile up!).
And I get a lot of out of doing this, frankly. For one thing, tracking my expenses like this makes me a lot more conscious when I spend money. I know I’m going to put these numbers and stores and credit card details in black and white; I’m going to have to look at them, on the screen, there in front of me. No hiding! When I enter those facts in and I’m sitting on my sofa staring at them, how will I feel? Embarassed that I bought, say, the world’s ugliest pair of jeans on non-returnable clearance during late-night impulse shopping? (True story.) Or will I feel proud about the restraint I’ve shown and the money I’ve been able to set aside for larger goals?
For another, by using my spreadsheet, I can see quickly where my money is *actually* going. Have you ever had that experience of thinking you had a twenty in your wallet, only to pull it out and realize you’re down to, like, fifty cents? Tracking expenses like this will not only let you know you’ve already spent that twenty bucks, it’ll tell you where and when. Those frappuccinos are tasty, my friend, but sadly they are not free. And it can also help you realize that maybe you don’t spend as much as you thought you did on takeout (yay!), but you spend a lot more than you realized on clothes or video games or whatever.
And finally, my spreadsheet is a sort of security blanket. I admit, I have some anxiety around money. I come from a family that was always pretty middle class, but my extended family was not, and I’ve seen the struggles they’ve gone through as a result. I’ve also seen how it affected my own parents to worry about extended family who needed a lot of help; heck, in recent years I’ve been the one sending help myself. Keeping track of expenses like this is deeply reassuring to me. This is me taking enough care with myself to know what I’m doing, to face head-on how I’m doing instead of trying to hide away from things that might be scary. In its own way, this is a form of self-love.
