Tuesday, September 1, 2009
#34 - Track Finances Daily for 3 Months
This goal came about after reading "Your Money or Your Life." While the book managed to stretch about 20 pages of useful info into over 400, there were a few valuable tips that I managed to pick up. The book's authors put a huge priority on knowing exactly where every penny that comes into or out of your life goes. To do this, I now keep a small notebook with me all the time to track my expenses. The point of this is to know exactly where you stand in regards to your spending habits.
The second useful tip I picked up is to put all of these expenditures into monthly categories to be analyzed at the end of each month. The goal here to is to review and determine if I am getting satisfaction or fulfillment out of where my money is going. If I am, then I need to make the decision on whether I should put the same amount of money into that category or if it is ok as/is. If I am NOT getting fulfillment out of a category, then I need to make the decision to scale back on expenses in that area.
Examples here would be money spent on meals with friends versus money spent on meals by myself. The former helps build up my social life and is a way to spend time with friends and family. The latter usually comes about when I was too lazy to pack a lunch for work and need to buy something from a local restaurant. The one I get satisfaction from, the other, not so much.
The final tip I got from the book was to make a wall chart tracking my expenses, income, savings and debt from month to month. Having this visual reminder has made a big difference in getting control of my finances.
Posted by Martin at 3:05 PM