Unraveling Money – My Exploration of Personal Finance and Productivity

May 26, 2009

How to keep track of your expenditures: Part 1

Filed under: Keeping Track of Expenses — unravelingmoney @ 6:35 am

There are a few key steps to keeping track of expenditures:

1. Have a daily system for tracking/reporting expenditures – ALL expenditures

2. Have a monthly, bi-weekly or weekly system for entering your expenditures into Excel. Yes, you can use personal finance software as well, but I like the hand-entering system because it forces me to be extra-conscientious of the money I’m spending.

I choose to carry around a small notebook in which I record my expenditures by day – this goes with me everywhere. I’ve gotten really good at remembering what I spend, but I highly recommend entering line-items each evening so that nothing is left out by accident. Dorky? Yes. Effective? Absolutely. It causes me physical pain when I have to record a large purchase in the notebook.

When you make entries, I recommend you indicate the exact amount you spent along with a simple categorization of the expense – in line with your Excel.

For the next post on this subject, I’ll talk about how to enter this data into your monthly spreadsheet.

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