Using the Information

I was talking to a couple of guys at work over the past week – they knew that my wife and I had paid off our mortgage earlier this year and had a lot of questions about spending. Both guys seem to be living paycheque to paycheque, and have trouble making it through all of their bills by the end of the month. I explained how my wife and I set up our finances and how we prioritize our spending on a month-to-month and annual basis.

One thing that I told them might help them find “holes” in their finances would be to use an app and track every dollar they spend for a month or two. There are a ton of free apps, and a lot more for under $5 that have easy tracking of expenses along with weekly and monthly reports and comparisons. From the standpoint of someone “not knowing where the money is going”, this kind of thing would be really helpful.

Personally, I’ve never used budgeting software – almost every cent I spend in a month is on my credit card, so I can easily look at a statement and see where my paycheques have been spent. What I have used in the past is diet tracking apps on my phone. I’m 6 feet tall and weigh somewhere between 175 and 180 lbs at about 15% bodyfat (based on the handheld tool I own). I have this goal of getting my bodyfat percentage down under 10% to demonstrate that I have abdominal muscles.

I used the calorie tracking app consistently for a few weeks – tracking each and every thing I was eating….until I didn’t feel like doing that anymore. There was a weekend where I knew I wasn’t going to hit the caloric goals that I was supposed to, in order to achieve the lofty goal I had set for myself. So, I didn’t count calories that weekend, and then went back to tracking during the week when my diet is much healthier and stable.

What makes this kind of tracking stuff work, is actually using it. If I had a day where I was supposed to eat 2,000 calories and basically ate a whole pig instead, tracking anything isn’t really all that beneficial. Similarly, tracking expenses doesn’t really do anything if you aren’t willing to give up spending on things that you find are causing you to run out of money at the end of the month. The tracking doesn’t really work if you don’t use it.

Do you track anything on a daily basis? How do you stick with the tools?

10 thoughts on “Using the Information”

  1. Our bank offers FinanceWorks (Quicken I think) free as part of online banking. It is pretty good. I have tried Mint.com in the past. Currently I’m using Personal Capital. Still not 100% sold, but there are some parts I like about PC.

  2. A few months before I retired, I built up an excel spread sheet and accounted for every dollar I spent under various subjects. It was an eye opener. I still do it that old fashion way, no apps for me. Don’t have a cell phone.

  3. I also just use good ol excel. works well for us and I have been consistent with it for three year now.

  4. I have also used excel in the past, and will be again, once I tweak it a bit (I have too many categories, which I find makes it a bit …ugh…).

    I also use an excel spreadsheet as a food journal, to track my weight.

    Anything will work if you use it; nothing will work if you don’t use it.

  5. I use Mint, in part because I can be lazy and not track … and it still tracks for me.

    I’m trying to lose weight, so I’ve been trying to count calories. For me, tracking calories and changing my eating behavior is way harder than tracking and changing my money habits!

    I also track my time on and off to see if I’m using my time efficiently.

    So apparently, I track quite a few things. I do find it helpful.

  6. I track everything via Mint. The auto-categorization is very handy, and the historical trending tools are incredibly eye-opening for finding spending leaks.

  7. I’ve been using Microsoft Money since 1999 and it’s still going strong. It’s incredibly revealing when you can do year over year comparisons to see where you’ve been spending your money.

    About five years ago my wife and I even started breaking down our grocery bills into categories like meat, fruit, vegetable, dairy, bakery, etc to dig deeper into where exactly our $8K a year grocery budget was going.

    Tracking to that degree is not for everyone but I definitely think it’s a worthwhile exercise for anyone trying to get a handle on their spending.

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