If you’re constantly finding yourself broke before the month ends, and you’re wondering where all your money has gone, then it’s time you start to track your money. Otherwise, the vicious cycle will just keep going on and on.
Tracking your money helps you to gain more control of your money instead of letting your money controls you.
Over the last few years, tracking my money has been tremendously beneficial in helping me plan and achieve my financial goals. Although I’ve not achieved all my financial goals, I’m progressing steadily.
In keeping track of your money, it is important to track all money that comes in – your salary, lottery winnings, picking up a note from the floor, etc – and all money that goes out – groceries, food, transport, etc.
Below are a few things that I do to keep track of my money.
1. Whenever I receive an income without an official payment voucher such as gifts, picking up a note from the floor, etc, I’ll keep a record of it on my mobile phone with the date included.
2. I’ll ask for a receipt for every purchase I make during the day, big and small, and keep it in my wallet. If a receipt is not available, I’ll jot it down on my mobile phone under ‘Message’ and save as ‘Drafts’. I save all transactions without receipts for the entire month under the same ‘Draft’.
By the way, I’m using a Nokia phone. You may choose to save it anywhere you deem fit on your own mobile phone, PDA, or a notebook.
Oh… And remember to separate the transactions according to dates.
3. At the end of the week, I’ll file all the receipts in a proper file. For transaction records I kept in my mobile phone, I’ll write them down on a piece of paper and file it together with the receipts. Remember to include the dates as well.
4. At the end of the month, I’ll total up all my income – salary, dividends, interest income, etc – and my spending – food, transport, health, entertainment, etc – and then enter the data into my Personal Monthly Budget statement using Google Personal Finance Tools. You may also consider using paid software like Quicken.
5. Rarely do I lend money to someone. But if I do, I’ll write down the amount of money lent and key it into my Budget statement as ‘Money Lent’ highlighted in red under the ‘Miscellaneous’ column as soon as I get the chance.
If the money is returned during the same month I lent it out, I’ll simply delete the earlier record from my Budget.
But if it’s returned in a different month, then I’ll record it down in that month’s Budget statement as ‘Money Paid Back’ under the ‘Income’ column.
So, there you go. It’s very simple and not that hard to do. But it certainly does require some discipline to keep up with it.
One point which I want to stress is that you have to jot down your income and/or purchases that are without official payment voucher or receipts immediately, if not, as soon as possible. It is very easy to forget about them.
This method of tracking your money will paint a clear picture of where and when your money come and go. It also allows you to develop a better understanding of your own spending habits.
Without this method, you will forever be trapped in a financial struggle.
Cheers~
P.S. Do you have any suggestions on how to track your money? We’d love to hear it from you. Please share with us in the comment section below.
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on Mar 9th, 2009 at 9:28 am
When I started my computer consulting business 5 years ago I was forced to start tracking every penny and keeping receipts. This new habit flowed over into my personal finances as well. Now I can’t imagine not tracking my finances. I ALWAYS know where the money goes. I can’t quite say I’ve always made the wisest decisions with that money, but that’s another post/comment.
Thanks for sharing your insight and keep up the useful content. Eric
on Mar 9th, 2009 at 11:57 am
@Hi Eric,
Thank you for your comment!
I’m glad you’ve allowed that habit to flow over into your personal finances. I’ve seen a lot of business people who don’t manage their personal finances, which I find quite puzzling. And some of them don’t even manage their business finances well. Pretty sad.
I always think that many of the life lessons are applicable to both individuals and businesses, and money tracking is definitely one of those lessons.
Cheers~
Mark
on Aug 1st, 2009 at 1:57 am
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