Step #10 Track Your Spending

For the next six weeks of Forget the Joneses Project, I want you to account for every penny you spend.

Knowing exactly how and where you spend your money will provide you with key information about where your money goes. It will also give you valuable insight into what your spending weaknesses are and provide information about what you can improve upon. This information will be important to have when you create your budget.

There are many ways to track your spending. It’s important for you to pick the method that is easiest for you, fits your lifestyle, and one that you can stick to. Think ahead to how you plan on budgeting (a future step) as certain methods listed below may complement certain budgeting methods better than others.

• Keep a Spending Journal You can use your FTJ journal to do this, or get a smaller spiral notebook that fits in your purse. For every item you buy, track the amount spent and to which category it belongs, such as: groceries, gas, entertainment, restaurants, clothing, and so on.
• Save Receipts in an Envelope This is a really simple way to track spending because it doesn’t require much time. Simply grab an envelope and make sure that both you and your spouse account for all of your purchases – whether cash or credit – by placing the receipt in an envelope. If you make any purchases where a receipt isn’t available (vending machines, for example) write the amount spent and the item on the envelope itself. This works well for spouses who may be less than cooperative. It isn’t too much to ask them to simply hold onto their receipts.
• Use a Program Like Quicken or Money This can be done in conjunction with keeping a spending journal or a receipt envelope and works well for those who plan on using a computer program as a part of their budgeting system.Don’t worry about categorizing the purchases right now. Simply gathering the information will be sufficient. After the end of the three weeks, we will begin to categorize your purchases so that you can create a budget.
• Use Online Sites Like Mint.com If you want to take electronic budgeting one step further, consider an online tracking site like Mint.com. Not only does Mint.com use features like Quicken and Money, it connects to your banking/credit card information nightly to automate the process even further. Best of all, it’s completely free.

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Is it bad that I Haven't completed Exercise 8 or 9 yet? Flyboy has been flying and unable to check in....I will remind him to log on so we can catch up! LOL

If it's any consolation, since starting this, I have kept EVERY SINGLE RECEIPT and put them in an envelope inside my FTJP journal!

No, but do the Net Worth exercise as soon as you can. I want to use it as a "baseline" number when we check back in on your progress in the future. Also, writing down what you've learned is important to do before you go off the spending freeze. Try to talk about it with your dh if possible when he's available. My own dh brought up certain things he'd learned during the freeze which generated some great conversation. It solidified what we want to do moving into the future. HTH

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I keep track of every penny I spend and never carry cash so I don't spend out of habit.

I cant wait to see totals for the next 6 weeks. I keep notebook that I have written every day of month and then next to it what I spent on what. Bills, others, etc. In my last blog is the total for January so far. It is pretty consistent with me in general but need to work on alot of catagories. Will be interested to see if I improve over next 6 weeks. Thanks!

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Amber

YUCK! I am only kidding...this step is something that will be VERY worthwhile to me. I just hate this sort of thing. I am great about "big" things...would never buy a house/cars I couldn't afford...always automatically have money deducted in savings etc. I am AWFUL about little things...a magazine here....McDs there. I know it adds up to big $$$. I am sure this will be the most useful step to me so far. Thanks. This is a great project.

Does it matter if we are already doing this? Should we do another 6 weeks? We started at the beginning of FTJ to track our spending in my notebook. I will probably continue for a while to really see where the cash is going....

Thanks

Tracy

I did this for all of 2007 and I have to say that it did not mean anything to me until the other day when I went back and saw all of the money we spent on impulse purchases and eating out. It was truly a wake-up call for me!

Since going back to work this month after maternity leave, I have been making my coffee at home in the morning. And we have only gone out to dinner for my birthday in Nov since DD was born. (And my MIL paid!)

This is great. I am just starting to get back into using Microsoft money again and am sooo excited. I love seeing my spending separated by category so I can know where to cut down. Plus having to write it down keeps me from spending!

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Proud mommy to adorable Kinsley

YAY! This is an easy step for us...We started doing it about a month ago and let me tell you...when you first start ,it is SHOCKING to see where the money goes! We have already made some big changes (thanks in part to that and the spending freeze!).

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