July 17, 2022 • 39 mins
What is tracking expenses and how will this help in getting a budget under control. This is the easiest way to setup a budget and to maintain a budget without using a lot of your time.
Article Links:
https://www.kindafrugal.com/benefits-of-tracking-your-expenses/ By Jerry Graham
https://richardkleincpa.com/importance-of-keeping-track-of-your-expenses/
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Unknown (00:04):
Hello, I'm your host, Mr. Chuck, I retired accountant
turn truck driver, I reduce mydebt in a relatively short
period of time, debt reductionto achieve financial freedom
takes commitment, confidence,determination.
(00:25):
Benefits of tracking expenses?
What is tracking expenses? Andhow will it help in getting a
budget under control? This isthe easiest way to set up a
budget and to maintain a budgetwithout using a lot of your
time.
First of all, I got two articlesin my show notes if you'd like
(00:49):
to link to him, and check themout. But we're gonna get to
those a little bit later. Whatis tracking expenses? is simply
put tracking expenses? Is thisthe matter of you? Keeping your
own to record of everything thatgoes through your checking
(01:13):
account, your savings account,and all your credit cards
separate from what the bank isdoing? And why do you want to do
that? I keep saying back in theolden days, pre online banks,
you had a checking account.
And maybe you had a credit card,but a credit card, you got a
(01:35):
statement once a month, soreally didn't know if you didn't
use it too often was no bigdeal. And maybe it was a
surprise when you got yourmonthly statement that you went
over, that you spent more moneythan your available credit.
Well, that should never everhappen, that perhaps it did. On
(01:56):
your checking account we kept acheck registered was simply a
writtenitems of everything that went
into your checking account, andcame out of your checking
account.
And you record every check, youwrote the date,
check number, who it's to thedollar amount. Generally
(02:21):
speaking, if you wrote it to agrocery store, you knew that was
for groceries. Or if you wroteit to a gas station, you knew
that was for gas for your car.
So you pretty much knew by thename of who you were writing a
check to have what generallywhat it was for. But sometimes
you would put notes in therelike you would appliance company
(02:41):
store, and you would putpurchase new TV or new TV, or
just TV, so that he reminds youthat you buy yourself a new TV.
So every time you would depositmoney, you would add that to
your balance. And every time youwrote a cheque, you would
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subtract that from your balance.
And then once a month, you wouldreconcile your written register
to the bank statement that yougot in the mail. Well, since we
have online banking, that's kindof one away. But you should
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still be doing something to thateffect. And the reason is, if
you write a check, and you holdit, say it's like December 20,
and you're writing a couplechecks, to make donations to
charity, and you want that to beon your tax return for the
(03:43):
current year. But you don'treally have enough money in your
checking account at that point.
So you write a check you datedDecember 20. Maybe you hold a
check to December 29. And youmail it because then you're
gonna be paid the next day, andyou'll have enough money to
cover the check. And then thatis in the mail for a couple
(04:06):
days. And then maybe theyreceive it or maybe when the
charity that you mailed it towas on vacation because of the
holidays. It might be four orfive or six days later, before
they open it up and process itto make a deposit in their bank.
And then they take it to theirbank and might be a couple days
(04:28):
more before the bank clears andit shows up in your checking
account. So it could be a one ortwo week
delay before it actually moneyis actually taken out of your
checking account. But in yourregister, you record that when
(04:50):
you write the check, not whenthe check clears so that at the
end of the month, that would beconsidered a
Outstanding check. And the samething with deposits. If you made
a cash or if you made a depositof a check, it may be two or
three days before it shows up asa deposit in your checking
(05:13):
account. That would be anoutstanding deposit. So when you
get your bank statement, and atthe end of the month, now we're
doing this online, at the end ofthe month, let's say that you're
pretty good. You go online, youknow what your balance is, you
put that in your software thatyou're using, and you clear
(05:34):
everything and then you unclearThis is how I do it, then you're
unclear the items that have notshowed up and your checking
account yet. And then thereconcile balance should become
to zero. I do all this using aprogram that I pay $9.99 I think
(05:56):
it's about 10 bucks a year, itmight be $9.95, somewhere around
there. But that's a yearlycharge, once a year, I pay that
and it I go online, I log in, Ididn't have to download any
software, I don't have to do anyof that. I go in, and I enter
all the transactions that wentthrough my checking account my
(06:18):
savings account, and or mycredit cards that I'm currently
using.
And then once a month, Ireconcile it by put in the bank
balance, and then I do it theeasy way I click the box, it
says clear all and then I gothrough and if it doesn't come
to zero, then I figure out whichones are outstanding. And I
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unclick those and it comes tozero and I'm done. It takes me
about one or two minutes, itcould because I keep it updated
every week. Every payday I payonce a week, I update my check
register. And it's quick andeasy. I spend maybe two or three
minutes a week and then I spendmaybe another two or three
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minutes at the end of the month,clearing everything out. And by
the importance of this is youknow what how much money you
have in your checking account,you know how much money is
available for you to use, and ortransfer to your savings
(07:24):
account. I'm gonna go to anarticle that's called the
importance of keeping track ofyour expenses. There is a
popular saying that the easiestway to becoming bankrupt is by
not paying attention to yourexpenses. There is nothing that
captures the importance ofkeeping track of your expenses.
(07:45):
Better than saying that. So ifyou want to go broke,
continue on the path of notknowing how much money you have
in your checking account. Theresponsibility of taking care of
our own finances doesn't happenwhen you start earning from your
job. It starts much earlier forsome when they get to college
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and for others even earlier. Ifyou don't learn how to manage
your finances earlier in life,you may find it more difficult
to adopt proper monetary habitslater, when you begin to earn
from your employment orbusiness. In life if you're
continually in debt, it meansyou do not pay enough attention
(08:30):
to how you spend your money.
It's important to monitorspending as to avoid falling
into a nasty financialsituation. People purchase many
things over the course of amonth. It may just be a pack of
gum, a newspaper and ice cream,or even clothing and household
items. At the end of the month.
(08:53):
When you evaluate yourpurchases, you may discovered
you made more than 50 purchasesjust in one month. At that rate.
If you do not track yourexpenses is easy to go overboard
beyond your income. Why trackyour spending. Being aware of
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our spending habits is the bestway of utilizing our money. When
you know how much money youspend is easy to balance your
income with your spending andeven save for the future. If you
operate a budget daily, monthlyor even annual, the best way of
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ensuring that your spending iswithin the budget is by tracking
your spending. When you trackyour spending you know where
your money goes, he can ensurethat your money is used wisely.
Tracking your expenditures alsoallows you to understand why
you're in debt and how you gotthere. this will this will then
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help you design itbefitting strategy of getting
out of debt, ways of keepingtrack of your expenses. There
are several ways of keepingtrack of your expenditures. And
even those ways may not beidentical, as people tend to
adopt systems and personalizethem to suit their interests and
needs. Some of these include thepaper trail, this is one of the
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best methods.
This is one of the most basicmethods. tracking your spending
by paper requires diligent andwriting down every transaction
immediately after thetransaction is done. The
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advantage of this method is thatit ensures you to make
comparisons with your creditcard statement to ensure that
your purchases matches thecredit card records. It's also
easy to track how much you spendin a month by simply tolling the
amount you have in your papertrail.
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The only problem with thismethod it's demanding II may be
unable to diligently record apurchase you make. Now I have a
easy way of doing this papertrail. You don't have to record
it in your online register rightaway, I'd be nice if you could
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keep the receipt. And on thereceipt if you if you want to
make it easy, put checkingcredit card,
put where you use or what youuse to pay for the item. That
way, when you get home, and youlog in online, you pull out your
receipts and you enter men.
That's the easy way. If youdon't want to keep receipts then
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you go online, you log into yourchecking account online, you
enter it in your register thatnew purchases, you log into your
credit card statement online andyou enter in your new
transactions. If you do it everyday, it only takes a minute or
two. If you do it once a week,it takes a little bit longer. If
(12:09):
you do it once a month you'redread doing it, you'll put it
off and it won't get done.
Because it'd be way too timeconsuming. Using credit card
statements. Using your credit ordebit card statement allows you
to employ the advantage oftechnology and saves you the
stressful diligence of writingdown every purchase. At the end
(12:33):
of the month, you use yourcredit card or debit card
statements to track yourexpenditures. But this method
isn't complete. Because itdoesn't capture the cash
purchases, you may periodicallymake online services, there are
various online services thatenable you to track your
expenses online. These methodsare becoming popular because
(12:55):
they maximize the use oftechnology. Instead of using
paper trail than domains you towrite down every transaction or
use the credit or debit cardapproach that would require you
to total up your expense at theend of the month. All you need
is a software to do the work foryou. In short, when you track
their expenses, you experiencefreedom and spending while
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avoiding the fear of debt.
tracking of expenses ensuresthat your financial life is
manageable. And within meansI use count about all one word
count co untabout.com, it's $10a month, I do not link it to my
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bank account. Because that's thefading the purpose the one of
the major purposes of youentering this and putting in
manually is so they can rememberand know where your money is
gone and how much money you havespent. If you automate it too
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much, you're gonna make it kindof easy. And then again, if you
write a check is not going to beon the bank statement, it's not
going to get in your restauranttoo. After it clears, then it
may be too late. Because if youwrite a check for $1,000, and
it's outstanding, you mightforgotten about it. And then you
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spend that $1,000 Again, or atleast part of it. Then when that
check clears, you're gonna beoverdrawn. So manually enter
your transactions. And if youjust keep the receipts as you do
your spending, and every day,enter it. It's quick and easy to
do. Now you may miss a thinghere or there.
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I understand. But if you get themajority of men there is going
to be the best way to do it. Andthat's what I do. I became debt
freeIn three years and eight months,
because one, I trackedeverything, and two, I had a
budget, and I was trackingstuff, so I could stay on my
budget. Now, I didn't cut outanything. I didn't go without I
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didn't. Do you know, I mean,it's not like I suffered
darkness. I just managed mymoney. And I managed my
spending. And I knew that, youknow, at certain times in a
month, I had a mortgage payment,do I had credit card payments do
I had utilities do and I had nomoney available to pay for those
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items?
How? Because I kept track ofthings. The 11 important
benefits of tracking yourexpenses is my next article. Why
is it important to keep trackyour expense, it's important to
keep track of your expenses soyou know where your money goes,
you can then start ensuring thatyou spending your money wisely.
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When you track your spending,you can cut out bad spending
habits, create and stick to abudget and make sure you're
putting money towards yourgoals. This, look at the reasons
why you should track yourexpenses, there's 11 ways here
and let's get started. One putsyou back in control. It's a
terrible feeling, not knowingwhere your money goes, you
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wonder how you made he came tobe that your work hard. And yet
you don't have enough cash toafford a cheeseburger until the
next pay day. You feel lost andout of control. When it comes to
your personal finances. I'vebeen there and I don't even want
to go back to that place. Youhave to take control, no one is
going to stop you from spendingall your money, friends, family
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and business directly andindirectly encourage it, you're
in charge of your financialdecisions. Don't only one who
can make sure you don't wind upbroke, unable to retire. And
wondering how it all happened isyou taking back control starts
with tracking your expenses. Iremember back when I was much
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younger, on Friday, I used to goout and have a few drinks with
some friends. And I know peoplethat one out to a bar took their
paycheck to catch it at the bar,and pretty much spend most of
all of that at that bar on thatone day. Maybe they used part of
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it to pay the bar tab throughoutthe week. And then they bought
everybody drinks. And then whenthey left on Saturday morning,
they were broke. And of coursethat doesn't help if you're
married, you got bills do billsand getting paid. It just puts a
lot of stress in your life. Youwant you don't want to be that
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guy, you want to be the personwho knows how much you got, I
want I want out, I took a setamount of cash with me. And when
I ran out of cash, I was done. Iwent home when two that kept me
somewhat sober. And I was ableto drive home without getting
pulled over for a DUI. And let'sget back to budgets, spending
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tracking your spending toidentify budget categories to
reevaluate. And then if you usecount about it comes with
categories already set up. Andyou just be consistent on how
you apply your spending tocategory. So every time you buy
gas, no matter which gas stationis make sure it's auto fuel. If
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you go to the grocery storedoesn't matter which grocery
store it is make sure it'sgroceries, little things like
that. So when you'reconsistently applying to a
category, you're gettingconsistent information through
your reports. What percent ofyour net income is spent on
housing, food andtransportation? How much money
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do you save for a rainy dayevery month? How about your
discretionary spending? Theanswers to these questions can
be easily found by tracking yourexpenses. Once you know how much
you spend and for what you cansee where you can cut or
eliminate some spending, theycan usually find a few things to
stop buying to save money. Afterseeing the numbers you might
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decide reducing your housingcosts. Driving a more affordable
car or assigning a food budgetwe're making immediate and
lasting impact. Three shows yourbad spending habits. When you
start tracking your expenses,certain patterns, habits and
spending triggers emerge. Youmight be unaware of a merge. You
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might unearth unused discrediton new subscriptions, or a small
everyday expenses you can easilyeliminate like daily latte. For
example, it wasn't until I starttracking my expenses I realized
As I was spending over $40 aweek in gas stations and
convenience stores, buyingdrinks, snacks, gum and other
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unnecessary stuff, I wasembarrassed enough to cut it out
completely. It's not a ton ofcash. But it looks better going
into my emergency fund ratherthan going towards beef jerky
and gummy bears. tracking yourspending helps you get rid of
bad money habits and makes morefinancially sound decisions.
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Which is an example I have astepson who his mother pretty
much supports him. He wastes somuch money, he buys things, and
then he goes somewheres andleaves those what he bought
behind. So he then when he getssomewhere else, they like
traveling, he's got to buy thesame thing. Again, he's just
wasting more money, he'srepeatedly buying the same item
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over and over, and he leaves itbehind, he doesn't take care of
his stuff, he doesn't keep trackof his personal stuff. So he's
got to keep spending more moneyto buy it again. And again,
again, that's just me. I'mranting, nevermind. Number four,
it keeps you from overspendingon what you think you spend on
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certain things and what heactually spending could be miles
apart. You never know, if you'renot tracking spending. For
example, my family was spendinghundreds more on food. And we
thought we were it was shockingto see but the numbers aren't
lying, we immediately startfiguring out ways to reduce our
grocery spending and committedto doing so. And that's when I
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first started when I was in my20s or early 30s. I had a
program that was my checkroaster and did a budget when I
did a budget. And I went inthere and asked you for
different numbers and night, Ijust made up numbers. I mean, I
would go back, you know, maybe aweek and add it up and then
extend it out thinking I wasclose. And then once I got to
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the end of the month, I wouldcompare it in my budget. And my
answer was like two differentthings. And I've just give up, I
wouldn't even do it as thoughit's a waste of time, I'm just
wasting my time trying to dothat. Because there's no way I'm
gonna stay within my budget,because look at that. I'm not
even close, I got a goodprogram. And once I got the
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program and start thinking aboutthis a different way. It's not
that I had to stay within abudget. But I set up a budget
that stays with my spending. Soif my housing costs are X
amount, my budget is the sameamount. If my entertainment was
X amount, my budget was the sameamount. I wasn't trying to use
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my budget to control myspending. And once I figured
that out, then I could see wherethe money was really gone. And I
could look at differentcategories and look at the
details. So I'm not using thatno more why am I still paying
for it? I'm not using thisanymore. Why am I stuck? He
started eliminate things likethat. And you just use that
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slowly get you under control.
And you do it and you don't evenrealize it. And then I look at
why am I paying $130 a month forcable TV. I'm hardly ever home.
Only watch it 10% of the time,how can I get the same things
cheaper. And so I startedstreaming. So I got rid of my
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cable TV. Now I only stream theitems that I actually watch. And
I've saved tons of money doingthat. And five tracking helps
you avoid debt. If you havestudent loans a car payment and
carry credit card debt, seeinghow much you pay to creditors
every month is illuminating. Youcan drill down farther by
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examining your credit cardstatements and determining how
much of your money monthly debtpayments goes towards interest
and other fees. You'll beinspired to focus on getting out
of debt as quickly as possible.
You'll also be discouraged fromtaking on any new debt at once
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you see you got to make timelypayments on your debt.
Even if it's only the minimumamount.
So your first step is if you'repaying fees on credit cards
because of late payments underpayments or whatever, that's got
to stop. He has to make theminimum payment every month on
time and stop those fees is badenough. You're paying 1617 20%
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interest. Why do you want to paymore than that?
Six helps you cut out impulsespending keeping track of
spending caused you to thinkbefore you spent if you know how
much you spent and on whatyou're less inclined to purchase
something on a whim. When I'mreviewing my receipts and
logging my expenses. I know Idon't want to see hundreds of
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dollarsgoing out the door for mindless
spending on impulse purchasesevery month, seven keeps you
focus on your goals. You have totrack your spending if you plan
on reaching any financial goals,my main excuse for not getting
started with investing a lotspending was I didn't have
enough money, the truth was alittle different. I didn't need
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to get a raise or earn extramoney before I could start
focusing on the future. I hadenough money, but I wasn't just
managing it well. tracking yourspending will help you ensure
your spending your on yourpriorities and putting money
towards your financial goals,which could include getting out
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of debt, building your emergencyfund, starting an aggressive
savings plan or investing in thefuture. Eight reduce stress, not
knowing where your money allgoes cause stress not being 100%
sure you have enough money inthe bank to cover your bills is
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stressful. And stress is knownto cause all sorts of serious
health problems. So it stands toreason that if money is a major
stressor for you, managing yourmoney more effectively could
lower your stress level, or getrid of your money, anxieties all
together and improve yourhealth. Tracking your monthly
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expenses is one of thefoundations of better money
management improves yourrelationships. Early on in our
marriage, my wife and I didn'ttrack our spending, think about
a budget or have any idea whatour financial future look like.
We didn't have a huge income,discretion see between so we
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split expenses down the middle.
We reckon that since we bothwork and neither of us had an
exuberant taste, we didn't needa monthly plan and money would
just sort out work itself out.
That approach proved to be ahuge mistake when life threw us
a few curveballs. Once we starttracking expenses, we were able
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to get on the same page aboutour finances and see the big
picture. We talked everythingout and started making our
spending decisions together. Wesaid short term and long term
goals. We started budgeting andembrace frugal living, we
reached new levels ofcommunication and teamwork that
coupled the budgets togetherstays together. And all starts
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with expense tracking. Yes,money problems is probably the
number one cause of divorce andor problems within any
relationship. So if you worktogether and track your money
together,you both know exactly how much
you have and how much you'reearning and how much you're
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spending. You both know what'savailable, what's not available,
and what bills are going to bedue in the future.
10 ensures you catch fraudulenttransactions in time. I logged
in my bank account one morningand saw a large pending
transaction from Best Buy Ididn't recognize I caught it
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before my bank's frauddepartment did I didn't know if
they ever would have ever sinceI'm no stranger to electronic
stores. And I purchased fromBest Buy website before. I
didn't check my expenses everyday I might not have found out
about until it was too late.
Yeah, same thing with me. I'vechecked some of my expenses on
my credit card and found somecharges overseas somewhere and
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caught it. Some I got my creditcard information and was trying
to spend money on it. We blockedit and of course then they
cancelled that card and give youa new card. It's the same
account you just get a differentnumber on your card. Imagine
your debit card gets declined atthe grocery store area check
your rent check bounces nowyou're on the hook for late
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payments, fees and return checkfees. Your bank account is wiped
out until you go through theprocess of getting restored and
having a new cards issue.
Finding out your your accountwas compromised when it's too
late and you're bouncingpayments all over town is the
worst way to find out and trackyour expenses if for no other
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reason to protect yourself fromfraudulent charges. If you
hadn't logged into your bank andMonster take a daily habit
starting today. He lovin givesyou a sense of accomplishment.
If you've been strugglingfinancially wrapping your head
around when your money goes andcoming up with a plan to spend
your money wisely is a huge win.
It's an achievement that youhave you're feeling more
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confident about the future andhave you sleeping better at
night.
start realizing the benefits oftracking expense and start
Tracking today.
When I come back, I'm going totalk about how you're tracking
using an online account. Thetracking, you know, keeping an
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online register of yourchecking, savings and credit
cards can help you create yourbudget much more easier. So I'll
be back in one moment.
If you want to contact me torequest my spreadsheet for the
budget, or leave a comment orask a question, you can send it
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using my email, reduce debt,increase well@gmail.com.
reduce debt, increase wealth isall together no spaces. If you
like to ask a question, quickquestion in the subject. If
you'd like to request my monthlybudget, put budget spreadsheet
(30:54):
in the subject matter if youwant to leave a response of any
kind is put a comment in thesubject manner.
I will get back to you as soonas possible. How does tracking
help you with your budget,that's what I'm going to talk
about next. My final thoughts,you can do tracking manually and
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manually write everything downon paper. But that's very time
consuming. I recommend you get aonline program to do it like I
do. And by the way, I'm notgetting paid to promote count
about that calm. But it's a verygood and inexpensive program to
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do this function. If you havesoftware already that does the
same thing. You need to be usingthat.
If you may be you don't havesoftware and don't want to pay
the $10 a year, which is fairlycheap, I think there's a trial
period in there, you can use itto kind of learn it a little
bit. You can also do it on aspreadsheet. So if you got any
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type of spreadsheet, you knowhow to use a spreadsheet, you
can set up your descriptionacross the top date, check
number description, that's whoit's to the dollar amount,
category,and then run down a whole month,
you start out with a reconciledbalance on your online account.
So you go online, he looked atyour balance, is there anything
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outstanding? If so you accountfor the outstanding you start
with the opening balance, thenyou subtract and add from that
balance all the deposits, youmake the add to it and then all
the checks you write or all thepayments you make you subtract
from it, when you get to the endof the month, you got an ending
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balance, then you want toreconcile that out with your
online bank account to make sureit matches. If it doesn't match,
you got to figure out Did youforget to enter something, or
maybe you have something that'soutstanding, and you do that. So
once you get done with themonth, he did highlight, not the
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description area, but all thedetail that you put in,
highlight it, and sort it firstby category and then by date. So
that'll lump all the samecategories together, then you
can go out to the right andanother column and do a sum by
category. So you can sum up thefirst category that's on there
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would be an alphabetical order,you can sum that up go through
and now you have your totalamount spend by category, which
now you can use that to put inyour budget. So if you've never
done this before, you're justgetting started. Let's say it's
July, maybe the first or secondweek in July, you go back to
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June and start and you entereverything in you do the same
thing. If it's an onlinesoftware, you can do exactly the
same thing. The online softwarewill have the categories for
you. So you don't have to comeup with categories. But I'm sure
you know, it's not thatdifficult.
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And then at the end, you get 30days in there.
When you get all that done, thenyou want to get it reconciled.
Then once that's done, youupdate it to the current date.
Now you go back and you doreport for the previous month
and you want to do a categoryreport. You want the totals by
(34:43):
category for the month of June.
And those are the numbers you'regonna use to start your first
budget. When you use your budgetdollar amounts for you're gonna
do a budget for July no matterwhat how For ending July we are.
And you're going to use yourJune spending for your dollar
(35:07):
budget dollar amount, becauseyour budget is three columns, a
budget, actual difference, I dohave a spreadsheet set up to do
this to kind of help you, ifyou're interested, you can send
me an email to reduce debtincrease wealth@gmail.com. And I
(35:28):
will send you my spreadsheet,which you then can use in any
spreadsheet, it's an Excel,I do have a video out there,
Facebook, that goes over how touse it. So I'm not going to talk
about that. So now we have abudgeted amount. And now we go
to the current month, and it'sup to date to whatever you're
(35:48):
where you are. So you wouldstart at the beginning of the
month, through the current date,and you do another report by
category, not your actual, youput that dollar amount in your
actual. So now you can see howyou're doing and the current
month as compared to theprevious month. You do that for
(36:09):
a month or two to see how yourspending is going. If you are
thinking a certain category,you're spending too much, he can
look at the detail, maybe you'lldiscover some items that you no
longer need or use and you cancancel those subscriptions. Or
maybe you can cut back on buyingthat particular item that you
(36:32):
think you're spending too muchon.
Again, you need to think thatwe're in an inflationary period.
So like your gasoline spendingshould be going up every month,
not a whole lot, but should begoing up a little every month.
So you would need to adjust thatalso, your groceries may be
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going up. Or maybe you'respending way too much on
groceries or way too much onDining Out. And you can cut back
on the dining out and spend moreon groceries, that would be
okay. But the idea here is totrack and monitor where your
money is gone. So now you canmake an informed decision on
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what to do about it. If you donot have an emergency fund set
up, it's just a savings account,you put some money in there and
you never use it. And unlessit's an emergency, you need at
least a minimum of $1,000 To getstarted, then over time, you're
gonna slowly increase it.
That's the benefit of having atracking online software,
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because now you can get goodreports out of it. And you can
use it for your budgetingpurposes. Now your budget is
becomes fairly easy. And it'ssimple to do. And it's not going
to take you a whole lot of time.
So it's well worth the effort toget started today. And start
tracking everything that goesthrough your checking savings
and credit card accounts. Sothat you can look for fraudulent
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items, you can look foroverspending, you can maybe plan
ahead, you know, maybe have abig expense coming up, you can
not spend some money that younormally do cut back somewhere,
and you'll have the moneyavailable to pay that big
expense you have coming up. Onemore thing is once you get it up
to date, you do that every week.
(38:31):
You create a report once a weekso you can update your actual
amount on your budget. So youstart in the current month from
the beginning of the month.
Through the current day that youare in you update your budget to
the actual dollar amount. Everyweek. When you get all your
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tracking information in there.
create yourself a report.
Plugged in numbers. You can seehow you're doing
Hello, I'm your host, Mr. Chuck, I retired accountant
turn truck driver, I reduce mydebt in a relatively short
period of time, debt reductionto achieve financial freedom
takes commitment, confidence,determination.
(00:25):
Benefits of tracking expenses?
What is tracking expenses? Andhow will it help in getting a
budget under control? This isthe easiest way to set up a
budget and to maintain a budgetwithout using a lot of your
time.
First of all, I got two articlesin my show notes if you'd like
(00:49):
to link to him, and check themout. But we're gonna get to
those a little bit later. Whatis tracking expenses? is simply
put tracking expenses? Is thisthe matter of you? Keeping your
own to record of everything thatgoes through your checking
(01:13):
account, your savings account,and all your credit cards
separate from what the bank isdoing? And why do you want to do
that? I keep saying back in theolden days, pre online banks,
you had a checking account.
And maybe you had a credit card,but a credit card, you got a
(01:35):
statement once a month, soreally didn't know if you didn't
use it too often was no bigdeal. And maybe it was a
surprise when you got yourmonthly statement that you went
over, that you spent more moneythan your available credit.
Well, that should never everhappen, that perhaps it did. On
(01:56):
your checking account we kept acheck registered was simply a
writtenitems of everything that went
into your checking account, andcame out of your checking
account.
And you record every check, youwrote the date,
check number, who it's to thedollar amount. Generally
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speaking, if you wrote it to agrocery store, you knew that was
for groceries. Or if you wroteit to a gas station, you knew
that was for gas for your car.
So you pretty much knew by thename of who you were writing a
check to have what generallywhat it was for. But sometimes
you would put notes in therelike you would appliance company
(02:41):
store, and you would putpurchase new TV or new TV, or
just TV, so that he reminds youthat you buy yourself a new TV.
So every time you would depositmoney, you would add that to
your balance. And every time youwrote a cheque, you would
(03:01):
subtract that from your balance.
And then once a month, you wouldreconcile your written register
to the bank statement that yougot in the mail. Well, since we
have online banking, that's kindof one away. But you should
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still be doing something to thateffect. And the reason is, if
you write a check, and you holdit, say it's like December 20,
and you're writing a couplechecks, to make donations to
charity, and you want that to beon your tax return for the
(03:43):
current year. But you don'treally have enough money in your
checking account at that point.
So you write a check you datedDecember 20. Maybe you hold a
check to December 29. And youmail it because then you're
gonna be paid the next day, andyou'll have enough money to
cover the check. And then thatis in the mail for a couple
(04:06):
days. And then maybe theyreceive it or maybe when the
charity that you mailed it towas on vacation because of the
holidays. It might be four orfive or six days later, before
they open it up and process itto make a deposit in their bank.
And then they take it to theirbank and might be a couple days
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more before the bank clears andit shows up in your checking
account. So it could be a one ortwo week
delay before it actually moneyis actually taken out of your
checking account. But in yourregister, you record that when
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you write the check, not whenthe check clears so that at the
end of the month, that would beconsidered a
Outstanding check. And the samething with deposits. If you made
a cash or if you made a depositof a check, it may be two or
three days before it shows up asa deposit in your checking
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account. That would be anoutstanding deposit. So when you
get your bank statement, and atthe end of the month, now we're
doing this online, at the end ofthe month, let's say that you're
pretty good. You go online, youknow what your balance is, you
put that in your software thatyou're using, and you clear
(05:34):
everything and then you unclearThis is how I do it, then you're
unclear the items that have notshowed up and your checking
account yet. And then thereconcile balance should become
to zero. I do all this using aprogram that I pay $9.99 I think
(05:56):
it's about 10 bucks a year, itmight be $9.95, somewhere around
there. But that's a yearlycharge, once a year, I pay that
and it I go online, I log in, Ididn't have to download any
software, I don't have to do anyof that. I go in, and I enter
all the transactions that wentthrough my checking account my
(06:18):
savings account, and or mycredit cards that I'm currently
using.
And then once a month, Ireconcile it by put in the bank
balance, and then I do it theeasy way I click the box, it
says clear all and then I gothrough and if it doesn't come
to zero, then I figure out whichones are outstanding. And I
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unclick those and it comes tozero and I'm done. It takes me
about one or two minutes, itcould because I keep it updated
every week. Every payday I payonce a week, I update my check
register. And it's quick andeasy. I spend maybe two or three
minutes a week and then I spendmaybe another two or three
(07:03):
minutes at the end of the month,clearing everything out. And by
the importance of this is youknow what how much money you
have in your checking account,you know how much money is
available for you to use, and ortransfer to your savings
(07:24):
account. I'm gonna go to anarticle that's called the
importance of keeping track ofyour expenses. There is a
popular saying that the easiestway to becoming bankrupt is by
not paying attention to yourexpenses. There is nothing that
captures the importance ofkeeping track of your expenses.
(07:45):
Better than saying that. So ifyou want to go broke,
continue on the path of notknowing how much money you have
in your checking account. Theresponsibility of taking care of
our own finances doesn't happenwhen you start earning from your
job. It starts much earlier forsome when they get to college
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and for others even earlier. Ifyou don't learn how to manage
your finances earlier in life,you may find it more difficult
to adopt proper monetary habitslater, when you begin to earn
from your employment orbusiness. In life if you're
continually in debt, it meansyou do not pay enough attention
(08:30):
to how you spend your money.
It's important to monitorspending as to avoid falling
into a nasty financialsituation. People purchase many
things over the course of amonth. It may just be a pack of
gum, a newspaper and ice cream,or even clothing and household
items. At the end of the month.
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When you evaluate yourpurchases, you may discovered
you made more than 50 purchasesjust in one month. At that rate.
If you do not track yourexpenses is easy to go overboard
beyond your income. Why trackyour spending. Being aware of
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our spending habits is the bestway of utilizing our money. When
you know how much money youspend is easy to balance your
income with your spending andeven save for the future. If you
operate a budget daily, monthlyor even annual, the best way of
(09:34):
ensuring that your spending iswithin the budget is by tracking
your spending. When you trackyour spending you know where
your money goes, he can ensurethat your money is used wisely.
Tracking your expenditures alsoallows you to understand why
you're in debt and how you gotthere. this will this will then
(09:58):
help you design itbefitting strategy of getting
out of debt, ways of keepingtrack of your expenses. There
are several ways of keepingtrack of your expenditures. And
even those ways may not beidentical, as people tend to
adopt systems and personalizethem to suit their interests and
needs. Some of these include thepaper trail, this is one of the
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best methods.
This is one of the most basicmethods. tracking your spending
by paper requires diligent andwriting down every transaction
immediately after thetransaction is done. The
(10:43):
advantage of this method is thatit ensures you to make
comparisons with your creditcard statement to ensure that
your purchases matches thecredit card records. It's also
easy to track how much you spendin a month by simply tolling the
amount you have in your papertrail.
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The only problem with thismethod it's demanding II may be
unable to diligently record apurchase you make. Now I have a
easy way of doing this papertrail. You don't have to record
it in your online register rightaway, I'd be nice if you could
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keep the receipt. And on thereceipt if you if you want to
make it easy, put checkingcredit card,
put where you use or what youuse to pay for the item. That
way, when you get home, and youlog in online, you pull out your
receipts and you enter men.
That's the easy way. If youdon't want to keep receipts then
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you go online, you log into yourchecking account online, you
enter it in your register thatnew purchases, you log into your
credit card statement online andyou enter in your new
transactions. If you do it everyday, it only takes a minute or
two. If you do it once a week,it takes a little bit longer. If
(12:09):
you do it once a month you'redread doing it, you'll put it
off and it won't get done.
Because it'd be way too timeconsuming. Using credit card
statements. Using your credit ordebit card statement allows you
to employ the advantage oftechnology and saves you the
stressful diligence of writingdown every purchase. At the end
(12:33):
of the month, you use yourcredit card or debit card
statements to track yourexpenditures. But this method
isn't complete. Because itdoesn't capture the cash
purchases, you may periodicallymake online services, there are
various online services thatenable you to track your
expenses online. These methodsare becoming popular because
(12:55):
they maximize the use oftechnology. Instead of using
paper trail than domains you towrite down every transaction or
use the credit or debit cardapproach that would require you
to total up your expense at theend of the month. All you need
is a software to do the work foryou. In short, when you track
their expenses, you experiencefreedom and spending while
(13:18):
avoiding the fear of debt.
tracking of expenses ensuresthat your financial life is
manageable. And within meansI use count about all one word
count co untabout.com, it's $10a month, I do not link it to my
(13:41):
bank account. Because that's thefading the purpose the one of
the major purposes of youentering this and putting in
manually is so they can rememberand know where your money is
gone and how much money you havespent. If you automate it too
(14:03):
much, you're gonna make it kindof easy. And then again, if you
write a check is not going to beon the bank statement, it's not
going to get in your restauranttoo. After it clears, then it
may be too late. Because if youwrite a check for $1,000, and
it's outstanding, you mightforgotten about it. And then you
(14:23):
spend that $1,000 Again, or atleast part of it. Then when that
check clears, you're gonna beoverdrawn. So manually enter
your transactions. And if youjust keep the receipts as you do
your spending, and every day,enter it. It's quick and easy to
do. Now you may miss a thinghere or there.
(14:49):
I understand. But if you get themajority of men there is going
to be the best way to do it. Andthat's what I do. I became debt
freeIn three years and eight months,
because one, I trackedeverything, and two, I had a
budget, and I was trackingstuff, so I could stay on my
budget. Now, I didn't cut outanything. I didn't go without I
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didn't. Do you know, I mean,it's not like I suffered
darkness. I just managed mymoney. And I managed my
spending. And I knew that, youknow, at certain times in a
month, I had a mortgage payment,do I had credit card payments do
I had utilities do and I had nomoney available to pay for those
(15:36):
items?
How? Because I kept track ofthings. The 11 important
benefits of tracking yourexpenses is my next article. Why
is it important to keep trackyour expense, it's important to
keep track of your expenses soyou know where your money goes,
you can then start ensuring thatyou spending your money wisely.
(16:00):
When you track your spending,you can cut out bad spending
habits, create and stick to abudget and make sure you're
putting money towards yourgoals. This, look at the reasons
why you should track yourexpenses, there's 11 ways here
and let's get started. One putsyou back in control. It's a
terrible feeling, not knowingwhere your money goes, you
(16:22):
wonder how you made he came tobe that your work hard. And yet
you don't have enough cash toafford a cheeseburger until the
next pay day. You feel lost andout of control. When it comes to
your personal finances. I'vebeen there and I don't even want
to go back to that place. Youhave to take control, no one is
going to stop you from spendingall your money, friends, family
(16:46):
and business directly andindirectly encourage it, you're
in charge of your financialdecisions. Don't only one who
can make sure you don't wind upbroke, unable to retire. And
wondering how it all happened isyou taking back control starts
with tracking your expenses. Iremember back when I was much
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younger, on Friday, I used to goout and have a few drinks with
some friends. And I know peoplethat one out to a bar took their
paycheck to catch it at the bar,and pretty much spend most of
all of that at that bar on thatone day. Maybe they used part of
(17:28):
it to pay the bar tab throughoutthe week. And then they bought
everybody drinks. And then whenthey left on Saturday morning,
they were broke. And of coursethat doesn't help if you're
married, you got bills do billsand getting paid. It just puts a
lot of stress in your life. Youwant you don't want to be that
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guy, you want to be the personwho knows how much you got, I
want I want out, I took a setamount of cash with me. And when
I ran out of cash, I was done. Iwent home when two that kept me
somewhat sober. And I was ableto drive home without getting
pulled over for a DUI. And let'sget back to budgets, spending
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tracking your spending toidentify budget categories to
reevaluate. And then if you usecount about it comes with
categories already set up. Andyou just be consistent on how
you apply your spending tocategory. So every time you buy
gas, no matter which gas stationis make sure it's auto fuel. If
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you go to the grocery storedoesn't matter which grocery
store it is make sure it'sgroceries, little things like
that. So when you'reconsistently applying to a
category, you're gettingconsistent information through
your reports. What percent ofyour net income is spent on
housing, food andtransportation? How much money
(18:56):
do you save for a rainy dayevery month? How about your
discretionary spending? Theanswers to these questions can
be easily found by tracking yourexpenses. Once you know how much
you spend and for what you cansee where you can cut or
eliminate some spending, theycan usually find a few things to
stop buying to save money. Afterseeing the numbers you might
(19:18):
decide reducing your housingcosts. Driving a more affordable
car or assigning a food budgetwe're making immediate and
lasting impact. Three shows yourbad spending habits. When you
start tracking your expenses,certain patterns, habits and
spending triggers emerge. Youmight be unaware of a merge. You
(19:44):
might unearth unused discrediton new subscriptions, or a small
everyday expenses you can easilyeliminate like daily latte. For
example, it wasn't until I starttracking my expenses I realized
As I was spending over $40 aweek in gas stations and
convenience stores, buyingdrinks, snacks, gum and other
(20:07):
unnecessary stuff, I wasembarrassed enough to cut it out
completely. It's not a ton ofcash. But it looks better going
into my emergency fund ratherthan going towards beef jerky
and gummy bears. tracking yourspending helps you get rid of
bad money habits and makes morefinancially sound decisions.
(20:28):
Which is an example I have astepson who his mother pretty
much supports him. He wastes somuch money, he buys things, and
then he goes somewheres andleaves those what he bought
behind. So he then when he getssomewhere else, they like
traveling, he's got to buy thesame thing. Again, he's just
wasting more money, he'srepeatedly buying the same item
(20:52):
over and over, and he leaves itbehind, he doesn't take care of
his stuff, he doesn't keep trackof his personal stuff. So he's
got to keep spending more moneyto buy it again. And again,
again, that's just me. I'mranting, nevermind. Number four,
it keeps you from overspendingon what you think you spend on
(21:12):
certain things and what heactually spending could be miles
apart. You never know, if you'renot tracking spending. For
example, my family was spendinghundreds more on food. And we
thought we were it was shockingto see but the numbers aren't
lying, we immediately startfiguring out ways to reduce our
grocery spending and committedto doing so. And that's when I
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first started when I was in my20s or early 30s. I had a
program that was my checkroaster and did a budget when I
did a budget. And I went inthere and asked you for
different numbers and night, Ijust made up numbers. I mean, I
would go back, you know, maybe aweek and add it up and then
extend it out thinking I wasclose. And then once I got to
(21:59):
the end of the month, I wouldcompare it in my budget. And my
answer was like two differentthings. And I've just give up, I
wouldn't even do it as thoughit's a waste of time, I'm just
wasting my time trying to dothat. Because there's no way I'm
gonna stay within my budget,because look at that. I'm not
even close, I got a goodprogram. And once I got the
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program and start thinking aboutthis a different way. It's not
that I had to stay within abudget. But I set up a budget
that stays with my spending. Soif my housing costs are X
amount, my budget is the sameamount. If my entertainment was
X amount, my budget was the sameamount. I wasn't trying to use
(22:45):
my budget to control myspending. And once I figured
that out, then I could see wherethe money was really gone. And I
could look at differentcategories and look at the
details. So I'm not using thatno more why am I still paying
for it? I'm not using thisanymore. Why am I stuck? He
started eliminate things likethat. And you just use that
(23:07):
slowly get you under control.
And you do it and you don't evenrealize it. And then I look at
why am I paying $130 a month forcable TV. I'm hardly ever home.
Only watch it 10% of the time,how can I get the same things
cheaper. And so I startedstreaming. So I got rid of my
(23:28):
cable TV. Now I only stream theitems that I actually watch. And
I've saved tons of money doingthat. And five tracking helps
you avoid debt. If you havestudent loans a car payment and
carry credit card debt, seeinghow much you pay to creditors
every month is illuminating. Youcan drill down farther by
(23:52):
examining your credit cardstatements and determining how
much of your money monthly debtpayments goes towards interest
and other fees. You'll beinspired to focus on getting out
of debt as quickly as possible.
You'll also be discouraged fromtaking on any new debt at once
(24:12):
you see you got to make timelypayments on your debt.
Even if it's only the minimumamount.
So your first step is if you'repaying fees on credit cards
because of late payments underpayments or whatever, that's got
to stop. He has to make theminimum payment every month on
time and stop those fees is badenough. You're paying 1617 20%
(24:37):
interest. Why do you want to paymore than that?
Six helps you cut out impulsespending keeping track of
spending caused you to thinkbefore you spent if you know how
much you spent and on whatyou're less inclined to purchase
something on a whim. When I'mreviewing my receipts and
logging my expenses. I know Idon't want to see hundreds of
(24:59):
dollarsgoing out the door for mindless
spending on impulse purchasesevery month, seven keeps you
focus on your goals. You have totrack your spending if you plan
on reaching any financial goals,my main excuse for not getting
started with investing a lotspending was I didn't have
enough money, the truth was alittle different. I didn't need
(25:20):
to get a raise or earn extramoney before I could start
focusing on the future. I hadenough money, but I wasn't just
managing it well. tracking yourspending will help you ensure
your spending your on yourpriorities and putting money
towards your financial goals,which could include getting out
(25:41):
of debt, building your emergencyfund, starting an aggressive
savings plan or investing in thefuture. Eight reduce stress, not
knowing where your money allgoes cause stress not being 100%
sure you have enough money inthe bank to cover your bills is
(26:02):
stressful. And stress is knownto cause all sorts of serious
health problems. So it stands toreason that if money is a major
stressor for you, managing yourmoney more effectively could
lower your stress level, or getrid of your money, anxieties all
together and improve yourhealth. Tracking your monthly
(26:24):
expenses is one of thefoundations of better money
management improves yourrelationships. Early on in our
marriage, my wife and I didn'ttrack our spending, think about
a budget or have any idea whatour financial future look like.
We didn't have a huge income,discretion see between so we
(26:45):
split expenses down the middle.
We reckon that since we bothwork and neither of us had an
exuberant taste, we didn't needa monthly plan and money would
just sort out work itself out.
That approach proved to be ahuge mistake when life threw us
a few curveballs. Once we starttracking expenses, we were able
(27:08):
to get on the same page aboutour finances and see the big
picture. We talked everythingout and started making our
spending decisions together. Wesaid short term and long term
goals. We started budgeting andembrace frugal living, we
reached new levels ofcommunication and teamwork that
coupled the budgets togetherstays together. And all starts
(27:32):
with expense tracking. Yes,money problems is probably the
number one cause of divorce andor problems within any
relationship. So if you worktogether and track your money
together,you both know exactly how much
you have and how much you'reearning and how much you're
(27:55):
spending. You both know what'savailable, what's not available,
and what bills are going to bedue in the future.
10 ensures you catch fraudulenttransactions in time. I logged
in my bank account one morningand saw a large pending
transaction from Best Buy Ididn't recognize I caught it
(28:17):
before my bank's frauddepartment did I didn't know if
they ever would have ever sinceI'm no stranger to electronic
stores. And I purchased fromBest Buy website before. I
didn't check my expenses everyday I might not have found out
about until it was too late.
Yeah, same thing with me. I'vechecked some of my expenses on
my credit card and found somecharges overseas somewhere and
(28:39):
caught it. Some I got my creditcard information and was trying
to spend money on it. We blockedit and of course then they
cancelled that card and give youa new card. It's the same
account you just get a differentnumber on your card. Imagine
your debit card gets declined atthe grocery store area check
your rent check bounces nowyou're on the hook for late
(29:03):
payments, fees and return checkfees. Your bank account is wiped
out until you go through theprocess of getting restored and
having a new cards issue.
Finding out your your accountwas compromised when it's too
late and you're bouncingpayments all over town is the
worst way to find out and trackyour expenses if for no other
(29:24):
reason to protect yourself fromfraudulent charges. If you
hadn't logged into your bank andMonster take a daily habit
starting today. He lovin givesyou a sense of accomplishment.
If you've been strugglingfinancially wrapping your head
around when your money goes andcoming up with a plan to spend
your money wisely is a huge win.
It's an achievement that youhave you're feeling more
(29:48):
confident about the future andhave you sleeping better at
night.
start realizing the benefits oftracking expense and start
Tracking today.
When I come back, I'm going totalk about how you're tracking
using an online account. Thetracking, you know, keeping an
(30:12):
online register of yourchecking, savings and credit
cards can help you create yourbudget much more easier. So I'll
be back in one moment.
If you want to contact me torequest my spreadsheet for the
budget, or leave a comment orask a question, you can send it
(30:33):
using my email, reduce debt,increase well@gmail.com.
reduce debt, increase wealth isall together no spaces. If you
like to ask a question, quickquestion in the subject. If
you'd like to request my monthlybudget, put budget spreadsheet
(30:54):
in the subject matter if youwant to leave a response of any
kind is put a comment in thesubject manner.
I will get back to you as soonas possible. How does tracking
help you with your budget,that's what I'm going to talk
about next. My final thoughts,you can do tracking manually and
(31:17):
manually write everything downon paper. But that's very time
consuming. I recommend you get aonline program to do it like I
do. And by the way, I'm notgetting paid to promote count
about that calm. But it's a verygood and inexpensive program to
(31:38):
do this function. If you havesoftware already that does the
same thing. You need to be usingthat.
If you may be you don't havesoftware and don't want to pay
the $10 a year, which is fairlycheap, I think there's a trial
period in there, you can use itto kind of learn it a little
bit. You can also do it on aspreadsheet. So if you got any
(32:02):
type of spreadsheet, you knowhow to use a spreadsheet, you
can set up your descriptionacross the top date, check
number description, that's whoit's to the dollar amount,
category,and then run down a whole month,
you start out with a reconciledbalance on your online account.
So you go online, he looked atyour balance, is there anything
(32:25):
outstanding? If so you accountfor the outstanding you start
with the opening balance, thenyou subtract and add from that
balance all the deposits, youmake the add to it and then all
the checks you write or all thepayments you make you subtract
from it, when you get to the endof the month, you got an ending
(32:46):
balance, then you want toreconcile that out with your
online bank account to make sureit matches. If it doesn't match,
you got to figure out Did youforget to enter something, or
maybe you have something that'soutstanding, and you do that. So
once you get done with themonth, he did highlight, not the
(33:06):
description area, but all thedetail that you put in,
highlight it, and sort it firstby category and then by date. So
that'll lump all the samecategories together, then you
can go out to the right andanother column and do a sum by
category. So you can sum up thefirst category that's on there
(33:30):
would be an alphabetical order,you can sum that up go through
and now you have your totalamount spend by category, which
now you can use that to put inyour budget. So if you've never
done this before, you're justgetting started. Let's say it's
July, maybe the first or secondweek in July, you go back to
(33:54):
June and start and you entereverything in you do the same
thing. If it's an onlinesoftware, you can do exactly the
same thing. The online softwarewill have the categories for
you. So you don't have to comeup with categories. But I'm sure
you know, it's not thatdifficult.
(34:18):
And then at the end, you get 30days in there.
When you get all that done, thenyou want to get it reconciled.
Then once that's done, youupdate it to the current date.
Now you go back and you doreport for the previous month
and you want to do a categoryreport. You want the totals by
(34:43):
category for the month of June.
And those are the numbers you'regonna use to start your first
budget. When you use your budgetdollar amounts for you're gonna
do a budget for July no matterwhat how For ending July we are.
And you're going to use yourJune spending for your dollar
(35:07):
budget dollar amount, becauseyour budget is three columns, a
budget, actual difference, I dohave a spreadsheet set up to do
this to kind of help you, ifyou're interested, you can send
me an email to reduce debtincrease wealth@gmail.com. And I
(35:28):
will send you my spreadsheet,which you then can use in any
spreadsheet, it's an Excel,I do have a video out there,
Facebook, that goes over how touse it. So I'm not going to talk
about that. So now we have abudgeted amount. And now we go
to the current month, and it'sup to date to whatever you're
(35:48):
where you are. So you wouldstart at the beginning of the
month, through the current date,and you do another report by
category, not your actual, youput that dollar amount in your
actual. So now you can see howyou're doing and the current
month as compared to theprevious month. You do that for
(36:09):
a month or two to see how yourspending is going. If you are
thinking a certain category,you're spending too much, he can
look at the detail, maybe you'lldiscover some items that you no
longer need or use and you cancancel those subscriptions. Or
maybe you can cut back on buyingthat particular item that you
(36:32):
think you're spending too muchon.
Again, you need to think thatwe're in an inflationary period.
So like your gasoline spendingshould be going up every month,
not a whole lot, but should begoing up a little every month.
So you would need to adjust thatalso, your groceries may be
(36:54):
going up. Or maybe you'respending way too much on
groceries or way too much onDining Out. And you can cut back
on the dining out and spend moreon groceries, that would be
okay. But the idea here is totrack and monitor where your
money is gone. So now you canmake an informed decision on
(37:16):
what to do about it. If you donot have an emergency fund set
up, it's just a savings account,you put some money in there and
you never use it. And unlessit's an emergency, you need at
least a minimum of $1,000 To getstarted, then over time, you're
gonna slowly increase it.
That's the benefit of having atracking online software,
(37:43):
because now you can get goodreports out of it. And you can
use it for your budgetingpurposes. Now your budget is
becomes fairly easy. And it'ssimple to do. And it's not going
to take you a whole lot of time.
So it's well worth the effort toget started today. And start
tracking everything that goesthrough your checking savings
and credit card accounts. Sothat you can look for fraudulent
(38:06):
items, you can look foroverspending, you can maybe plan
ahead, you know, maybe have abig expense coming up, you can
not spend some money that younormally do cut back somewhere,
and you'll have the moneyavailable to pay that big
expense you have coming up. Onemore thing is once you get it up
to date, you do that every week.
(38:31):
You create a report once a weekso you can update your actual
amount on your budget. So youstart in the current month from
the beginning of the month.
Through the current day that youare in you update your budget to
the actual dollar amount. Everyweek. When you get all your
(38:51):
tracking information in there.
create yourself a report.
Plugged in numbers. You can seehow you're doing
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