Tracking your monthly expenses on a regular basis can give you an accurate picture of where your money is going and where you’d like it to go instead.
Here are 5 steps on how to track your monthly expenses.
1. Check Your Account Statements
Pinpoint your money habits by taking inventory of all of your accounts, including your checking account and all credit cards you have. Looking at your accounts will help you identify where you’re spending.
2. Categorize Your Expenses
Start grouping your expenditures. Some credit cards tag your transactions automatically into categories such as department stores or automobiles.
You might find your Starbucks run in the morning is costing you a lot. Or perhaps you’ll realize that you’re paying for the recurring subscription services you d be able to do without.
3. Use a Budgeting App
Budgeting apps like You Need a Budget and Mint are built to handle money on-the-go, allowing you to assign a certain amount of expendable income per month based on what you earn and what your payout.
These types of apps are going to work if you are able to log in your transactions, put in the time, and stick to your budget.
4. Explore Other Expense Trackers
A spreadsheet is another valuable money-tracking tool. You can find a variety of free budget templates online. Or, if you have a more complex financial portfolio, you can buy the software.
5. Identify Room for Change
As you track, be ready to make adjustments. It’s worth your time to keep tabs on your monthly expenses because of what you’ll uncover.
“Tracking expenses can be very valuable for finding out what’s really costing you, and what is not as bad as you thought,” Serlin says, an expert.
In addition, he notes that lowering the “big fixed expenses” in your life, like the cost of housing, vehicles, and utilities, can make a significant impact on your budget.
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