If you’re looking for a straightforward way to save money, here’s a simple strategy that can have a big impact. The best part? You don’t even have to change how you spend money at all right now. What is it? Track everything you spend for an entire month.
Don’t Change Anything Right Now
I’m serious. I’m not asking you to make any changes to what you’re buying. You can still keep doing whatever it is you’ve been doing. Love getting a massage every month? I don’t blame you. Don’t stop…make that appointment for next month. The goal isn’t to make changes, because then you won’t be tracking a normal month. You want to see what you normally spend money on each month.
What Should you Track?
Now, when it comes to tracking your spending, I’m not talking about just the big stuff like rent or your car payment. I mean absolutely everything. From your morning coffee to that random chocolate bar, if you spend money on it, write it down. It doesn’t matter how small or seemingly insignificant the purchase is; if it leaves your wallet, it goes on the list.
And to be very specific…I don’t mean just cash. Yes, if it leaves your wallet it goes on the list. But also if it goes on your credit card, or out of your Paypal or Venmo accounts. It doesn’t matter how you’re paying for it. If you’re laying out money for something, no matter how it’s being spent, write it down.
How Should You Track it?
The goal is to make this as easy as possible for you. So you should track it in a way that you’ll actually follow through with. You may want to write it down on a piece of paper so that no matter where you are you can track when you spend something. Or maybe you want to have a spreadsheet that lists every single thing you spend that month, along with what category its in. You may want to do more than one method. You may want everything in a spreadsheet, but also have a note on your phone (or piece of paper) that you can write something down when you spend money while you’re out. Then you can transfer it to the spreadsheet once you get home or once a week.
It’s completely up to you. There is no wrong or right way to track your spending. The goal is to make sure you track ALL of it, not just some of it. So use whatever method will make sure you track every single expense.
Why Should You Track Your Spending?
So, what’s the point of all this tracking? First off, it helps you make sure that you’re not spending more than you’re bringing in each month. It’s easy to lose track of the little things, but those little things add up fast. By the end of the month, you might be surprised at just how much you’ve spent on things you didn’t even think about.
But the benefits go beyond just balancing your budget. Tracking your expenses gives you a clear picture of where your money is actually going. Maybe you’ll realize you’re spending hundreds of dollars a month on coffee. Is that worth it to you? It might be! And there’s nothing wrong with that. You don’t have to change it if you don’t want to. But maybe you’d rather put that money toward something else, like a vacation fund or paying down debt.
The goal here isn’t to make you feel guilty or to stop you from spending money. It’s about awareness. When you know where your money is going, you’re in control. You get to decide if your spending aligns with your priorities. If it does, great! If it doesn’t, you can start making small changes that add up over time.
At the end of the month, take a good look at your list. Add everything up and categorize it. How much did you spend on food, entertainment, bills, and other categories? Are there areas where you could cut back without feeling deprived?
You may go through everything and be happy with what you’re spending. But it may turn out that you thought you were spending a few hundred dollars a month on entertainment, when it turns out you were spending over a thousand. Or maybe you felt like you had money to spare each month, but it turns out that most of your money went to pay your bills. Either way, it’s nice to know exactly where the money is going.
Remember, the purpose of this exercise isn’t to restrict yourself, but to ensure that your spending reflects what’s important to you. It’s your money—you should be spending it in ways that make you happy and help you achieve your goals.
So, grab a notebook or open a new spreadsheet, and start tracking. Your financial future will thank you.
Enjoy,
