Week 2: Track Your Spending…To Find Out Where Your Money is Going
MONEY SMART CHALLENGE
Money Smart Weekly Conversation Fact: Many Canadians are living outside of their means and incurring unwanted debt. 42% of adults between 35 – 44 either struggle to or are not keeping up with bills and financial obligations. (2014 Canadian Financial Capability Survey)
Last week, we asked about how long you could go without a paycheck (or some other form of regular income)
before you would be unable to pay your monthly expenses.
If you didn’t really know:
how much your monthly expenses actually add up to
how much your total income is each month
how much you spend on specific items
Track your spending for 1 month and find out.
Here are some tips and tools for tracking your spending from the website www.nomoredebts.org
Tracking where your money is going is the process of writing down what you spend. You may use a little notebook to do this, a spreadsheet, an app on your phone or other software programs. You might track as you spend money or you might collect receipts and track at the end of the day or week. Regardless of which method you choose, the purpose is the same; you want to see what you’re actually spending your money on so that you can make decisions based on reality, not assumptions.
Know Your Spending Habits – Track What You Spend
When you first start tracking expenses, you might be tempted to jot down what you should be spending. Fight that urge and spend as you normally would. Tracking isn’t meant to make you feel guilty and stop you from spending. It’s meant to highlight what your habits are so that you can make some choices and changes later.
It’s unrealistic to think that you’ll track your spending forever. If you can track for a month, be proud of yourself and incorporate what you learned into your money management strategies.
Then if your circumstances change, go back to tracking for another few weeks to get your spending in line with your new level of expenses or income.
Tracking Spending for 1 Month Can Help You:
→ Calculate Your Debt Load (More to come on Week 7)
→ Set Up a Financial Plan or Budget (More to come on Week 9)
→ Evaluate Your Disposable Income Expenses (More to come on Week 11)
5 Options to Help You Track Your Spending
1. Download Excel Monthly Expense Tracker Worksheet from http://www.nomoredebts.org/learning_credit/monthly-expense-tracker.html
2. Download Monthly Expense Tracker (PDF) from http://www.nomoredebts.org/learning_credit/monthly-expense-tracker.html
3. Download Budget Calculator from http://www.nomoredebts.org/learning_credit/budgeting_tips.html#budget-calculator
visualize your budget by category
4. No access to technology? Request a copy of Money Management Basics.
Email your name and full mailing address to email@example.com and we will mail you a paper booklet that you can use to record your expenses and income.
5. Download a Free App for your Phone.
There are a multitude of Apps for your Android or iPhone such as:
Mint Dollarbird Goodbudget Spending Tracker
Check your App Store and iTunes for the one you like the best.
START the MONEY SMART CHALLENGE TODAY by
ANSWERING this QUESTION:
Money Smart Week 2 Question: Which of the following “Money Management Styles” best describes you?
THE ACCOUNTANT – Tracks every transaction every month using a spreadsheet or budgeting software. Their attitude is, “I want to know it all, and all of my income is carefully dispersed. I will only buy things if I know I can afford it. My income and expenses must balance.”
THE PRACTICAL – Budgets for and pays all the bills first. Then just spends any spare cash as they want. Their attitude is, “As long as my bills are paid, I don’t have to worry.”
THE REACTIONARY – Each month they compare if they have spent more or less than they budgeted for, if it’s more, then they cut back their spending. Their attitude is “Only manage problems- as long as I live within my budget I don’t need to focus on the details.”
THE OSTRICH – Seldom looks at their bank statements or considers what they have spent each month. Screen their calls incase a collection agency is calling. Their attitude is “if there is cash in my account, let’s go shopping”, until the rent is due, and then they get stressed and try to borrow some cash.
THE PLANNER – Always “pays themselves first” by setting aside a fixed amount or percentage of their monthly income for savings or investments. Their attitude is, “I have a financial plan and I’m sticking to it.”
Now, What Do I do?
Email your answer to the Money Smart Week 2 Question and your full name and mailing address to firstname.lastname@example.org
Your name will automatically be entered into a draw for a Samsung Galaxy Tablet. (a $300 Value!)
You can enter your name once each week for a total of 17 chances to win! Answer the question anytime before the end of the Challenge on May 28, 2017
So, If you missed answering the Money Smart Week 1 Question, go to Week 1 and answer it now.
(NOTE! Only residents of City of Camrose and Camrose County are eligible for the draw for the Samsung Galaxy Tablet.)