Last updated: January 5, 2018 at 1:38 am
In order to be in good financial standing, you need to track your spending. Any good business must track its spending, otherwise it will probably eventually go bankrupt. So, if a successful business must be smart with its spending every year, why shouldn’t you do so in your own personal life?
If you don’t track where you spend your money, you won’t know where you are spending too much (or too little). Keeping track of spending is especially important for ADHD’ers because we tend to be impulsive with spending which can be very detrimental to our lives.
I personally know this to be true from my own experience. For much of my life, I never tracked my spending, and then wondered where my money went. I hope that now I am a little wiser by tracking my spending recently. As obvious as it sounds, if you have financial problems, but you don’t know how you spend money, your problems will be very difficult to solve. Assuming you don’t already have enough money where you don’t ever have to every work again, you need to be financially smart.
Sample Spending Logs
You download and adapt the spreadsheet I made for my own spending so far for September 2016 in Libreoffice Calc format here, and Microsoft Excel format here. In addition to using spreadsheets, there are numerous apps for Android and iOS for tracking your spending. But ultimately, use what works for you. If you prefer to use a notepad, use a notepad. If you prefer to use your smartphone, use it and so on.
Budgeting Versus Tracking Your Spending
Budgeting is also very important for your finances, but I believe that budgeting and tracking your money are slightly different. A budget tells you the maximum amount of money you can spend during some defined amount of time for something you decide like a week’s spending or for a business project. Tracking your spending is the actual tabulating (logging) of your daily expenses.
But Tracking My Spending Seems Too Tedious…
While you might think tracking your spending is too tedious, but I think actually it doesn’t have to be very tedious, and can be relatively easy. In addition, it is a very good investment that will very likely pay off by making you both financially smarter and more conscious of exactly what you are buying. If you have a smartphone with a app that tracks your spending, you can immediately log what you buy and then not have to worry about it.
Using Credit Cards For Tracking Your Spending
Here is a way for easily tracking your spending: use a credit card for everything you buy. That way, you can easily see everything you spent if you login to your credit card account. A debit card would also do the same. A warning though: you MUST exercise self-control when using a credit card. If you don’t think you have the self-control not to overspend, then you should use cash only. If you prefer not to use a credit card or debit card, using cash is OK, but keep your receipts. I personally HATE having so many paper receipts, so once I log the spending into my spending log, I throw them away.
Reviewing Your Spending
In addition, periodically reviewing your spending is critical. If you log your spending, but never look at your weekly averages or monthly totals, then tracking your spending is not going to be useful for you. Of course, you won’t spend the same amount of money every day, which is why I prefer to look at average daily spending for a week, and total monthly spending.
What did you think of this article? Let’s have a discussion in the comments below.