One of the most important tenets of a stable financial life is to spend less than you make. That may sound pretty basic, and it is, but it’s also easier said than done in some cases. It’s surprising how quickly a few extra purchases here and there can add up to totally derail your financial health. The key to staying on top of that is to track your expenses. Know how much you need for your bills, know how much leeway you have, and keep things in the black. It makes tax time easier too.
Paper and Pencil
Certainly not the most glamorous technique, but also not prone to internet outages or software glitches, a basic paper budget can do the job (you can even print out blank budget pages from the internet). When you pay a bill, write a check, shop online or bring home a receipt, jot down what you spent and subtract it from your income for that period. A page taped inside a kitchen cupboard works, or in your planner. If you want to track budget categories, like groceries, utilities, or gas, make a list for each.
Excel or Spreadsheet
A more detailed, if complicated, option is to use a spreadsheet. If you have some familiarity with spreadsheets (or can learn), this can be a good choice. The spreadsheet can be set up to do the math for you; enter your income and expenses and keep a running tally. One advantage is that categories can be easily separated (even color coded), a total budget set for each, and you can see at a glance how much you have left for dinner out or supporting a worthy cause.
Apps vary in cost and features, but they can be very convenient. Some let you snap photos of your receipts, link with your bank account, or connect with a partner so everyone is on the same page. You can set goals and watch your progress, and get reminders when bills are due. Digital privacy is a reasonable concern, so make sure you choose a trustworthy platform or service before you share bank or financial data.
Choose and Use
Whether it’s simple and old-school, or a high-tech monthly service, the key is to make use of it. The one that works is the one you use.