Tracking your spending on a regular basis is very important to get an accurate idea of where your money is going and where you’d like it to go instead. Since spending money tends to be the easiest part of this, we’re going to focus on how to keep track of the spending in order to keep your budget intact.
Check your account statements
First thing to do is take inventory of all of your accounts. Pinpointing your money habits will help you identify where you’re spending. This is done by first looking at all of your accounts and where money is going in, and where it is coming out.
Categorize your spending
Let’s next begin grouping your expenses. Here’s some example of categories commonly found in spending budgets:
- Housing - rent, mortgage, repairs, HOA, taxes
- Household - toiletries, laundry, cleaning, tools
- Transportation - car payment, warranty, gas, maintenance, parking
- Food - groceries, restaurants, pet food
- Utilities - electricity, water, gas, garbage, phones, internet
- Clothing - adult, kids
- Medical - primary care, dental, specialty, urgent, medications, medical devices
- Insurance - health, homeowner’s, renter’s, auto, life, disability
- Personal - gym, hair, cosmetics, babysitter, subscriptions
Many times, a good categorization is a wakeup call on areas of spending that could be improved. You may notice that your morning coffee run is costing more than you originally surmised or some recurring subscription services that are going mostly unused.
Use an app
There are many useful apps designed to help you categorize, organize, and reduce your spending on nonessentials. Albert, Prism, PocketGuard, YNAB, and Mint are a few that have made names for themselves in making spending tracking much easier.
They are designed for on-the-go money management and allow you allocate an amount of spendable income based on the budgets you set within the app as well as tracking what you are spending as the month continues. Some may even sync your spending and transactions directly from your accounts in order to balance them for you.
You don’t have to use an app - a good, well-organized spreadsheet may be what works best for you and your life. There are many budget templates available online. There are also more advanced software options such as Quicken Premier if you have a more complex financial portfolio.
Sometimes, the simplest way is best and a notebook, pencil, and small pouch for collecting receipts may be all you need to keep tabs on your spending. If you go this route, it’s best to bring those things with you everywhere you go to make sure you don’t forget to account for something.
Find room for change
As you track, be ready to make changes to your habits. Keeping tabs on your monthly expenses will uncover some frivolous spending and where you can cut back.
It may be that you could do your nails at home instead of the salon, make coffee before you leave the house, make a list for the grocery and stick to it, bring your lunch, go to the dollar store for household items, try the thrift store for clothes, or carpool to work. Doing just a few of those things could reduce spending enough that you find more wiggle room in your budget.
Saving up for something special? Our Solidarity App could help keep you on track with mobile check deposits, bill payments, transfer funds, view account balances and more! Here at Solidarity, we’re always looking out for you.