And not where you *think* your money is, but where it actually is ;) We’re talking about all monthly expenses, savings, retirement funds, and even all that cash stored in that dusty box you’ve probably forgotten about.
It’s worth it even if you just do it once! I seriously can’t emphasize that any more – when you know where your money is going, you will feel more confident. plain and simple. I can’t promise you that you’ll be happy with the results (although you may also surprise yourself), but at least you know exactly where your paycheck is headed.
And it’s not that hard to do, really. A bit time consuming for sure, but easy to do. For your accounts, all you have to do is log in and copy and paste the amounts into a spreadsheet – you can create your own, use mine, mint, etc – whichever increases your odds of sticking to it.
And then for the “tracking” part, you can either:
- Tally up all your receipts at the end of the month – via the shoebox method.
- Export your checking transactions for the month.
- or even Using your credit card statements! This one isn’t for everyone (you know who you are), but if you applied all payments through the card, you’d have a nice breakdown all in one spot to use. Def. not for everyone.
Once you HAVE all of this data, then it’s just a matter of plopping it next to last month’s data and seeing the differences. Again, go w/ the most convenient and easiest route for you (I use the credit card route). What you do from that point forward is up to you.
I read a great post over on Vilkri’s blog that summed it up pretty nicely, giving a few of us bloggers a pat on the back. But besides the awesome link love and feelgood-ness (which of course is nice), it was a good reminder that I’ve come a long way since diving into all of this stuff. And I have to admit – it feels pretty f’ing good!
It also reminded me of another would you rather-like scenario a co-worker and I were talking about yesterday. He asked me if I’d want to know the whole truth on our start-up’s financial situation if I had the chance? At first, I was like noooooooooooo way! Ignorance is bliss baby! But the more I thought about it last night (financially addicted much?), the more my answer changed to, “Yeah, lay it on me!”
While I’m sure there are plenty of things going on behind my back, Ifeel like getting the details would surely help me plan better. And not only personal things, but day-to-day management of my team and future meetings. It would probably be the shock of a lifetime (worst case, anyways), but it would inevitably wear off and I’d at least be “in the know” at that point.
But back to being financially confident – the easiest way to do this is by monitoring your expenses and creating a manageable budget around it. It probably won’t be fun at first, but after a while you won’t even notice it. Hell, if you’re anything like me you might even look FORWARD to it! Haha…but don’t count on it, I’m pretty addicted ;)
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PS: If you don't trust yourself with another credit card, ignore this! This strategy is to help you get out of debt quicker, not risk adding more to it.