How to Track Your Spending

Working hard and spending your earnings is natural, but practicing good financial habits, like tracking your spending, is essential for safeguarding your financial future and building a healthier relationship with your money.

Tracking spending is the first step toward better financial practices. Understanding where your money goes each month can help you identify areas for improvement and make it easier to achieve your financial goals.

Here are some strategies to help you track your spending and take control of your finances:

Step 1: Start with a Budget

First things first, you should create a monthly budget that accounts for your income. Allocate funds for essentials like savings, rent, groceries, utilities, and transportation. Since these are necessary expenses, any remaining funds can be used for discretionary spending.

Your budget doesn’t need to be overly strict; it should be flexible enough to allow you to enjoy your money without feeling restricted. Once your budget is set, use it as a benchmark to compare your actual expenses throughout the month.

Step 2: Use a Spending Tracker or App 

With your budget in place, choose a method to track your expenses. You can use a notebook, spreadsheet, or app—whatever suits your needs. The key is to use a tracker that is easily accessible, so you can record expenses in real time. Logging expenses as they happen helps you keep records accurate and updated – otherwise, you may be left with unaccounted expenses when it’s time for you to do accounting.

Many apps also offer options to link your bank accounts and credit cards for automated tracking, though these features often come with an additional fee.

• Rent
• Utilities (Electricity, water, phone, internet, etc.)
• Transportation
• Food
• Savings
• Entertainment (Subscription to streaming services, movie tickets, concerts, etc.)

Breaking your expenses into categories helps reveal spending patterns, making it easier to adjust your budget as needed.

Step 4: Review Your Spending Weekly

Make it a habit to review your expenses on a weekly basis. Set aside time each week to review your expenses. A weekly review allows you to catch spending trends early and make adjustments before they impact your budget. Spend an hour going over your transactions, updating your spending log, and assessing whether you’re staying on track with your budget.

Regular Weekly reviews can also help keep you motivated by allowing you to see your progress toward your financial goals.