Its impossible, too much to manage
More then once I’ve looked over my bank and credit card statements thinking, “How in the world am I supposed to track all this?” For one month there could be in excess of 100 transactions! This doesn’t mean we were spending too much, just that we were spending too often. Spending too much was just a side effect of spending too often. How in the world can you track your spending when your statements are so busy? What kind of strategies can we implement to help make sense of all our transactions? How can we simplify our accounts to make it easier to keep track of our spending?
Track Your Spending by… tracking your garbage?
The number one indicator that you are buying too much is your garbage. Yes, I mean the amount of trash you are creating. I know, I know, we were talking about accounts and money and such. Really though, if you consider the number one “clutterer” of accounts is the sheer volume of transactions that occur, the best way to verify if its from spending is to pay attention to the amount of trash you’re generating. During our more ‘spendy’ periods, our trash bin would overflowing. However, when we focused and cut back spending our trash would be half full. This is not a coincidence, but a direct correlation to the amount we spend. Pay attention to your trash and cut back your spending if needed to bring transaction volume down!
Here is one you’ve probably not heard before, get rid of the “save as you go” automatic savings account contributions. I went ahead and just closed my savings account entirely to get rid of the headache. Pay attention to your account details because you may be charged for your account if you cancel this service. There were almost as many of these micro transactions cluttering up my statements as there were transactions. Which makes sense, since its based on your transactions! It was cluttering up my ability to track spending, so I got rid of it and recommend you do too!
Got it simplified, now make it easy
So we’ve cut our spending to reduce the number of transactions that appear on statements and cut other ‘clutter’ that was fogging things up by cutting “save as you go”. Now how do we keep track of all those transactions? There are several online tools such as Mint, Personal Capital, and YNAB. Mint and Personal Capital are free services, YNAB costs a little. I can only speak for Mint since I have been with them for a few years now. I will open a Personal Capital account in the future to observe the differences between PC and Mint.
Mint works by having you loading all of your account information onto their application or website, where they can track all of your transactions in one place. Some might be put off by allowing a single website to have such broad access to all their information. I can understand that, but feel quite comfortable with the security Mint has provided to keeping your information secure.
It’s a bit of work in the beginning, to get Mint tracking all of your expenses correctly. You can tag a certain type of expense and it will categorize it that way from then on (if you choose that option). It’s a bit of a hassle at first if you don’t keep up with it, but if you can take a few months categorizing and teaching Mint how to track your spending properly it works quite well. After a bit of time it really is quite simple to maintain and track your spending… and growth of your assets!
Spend, Track, Save
Tracking spending is never a real fun task, but if you don’t know where your money is going you’ll never know how to stop the siphon. It is my belief that if you simplify how you see your spending, it will be more enjoyable to track and you will be more successful at saving.
If you think it is a headache looking over your statements to track your spending, try to simplify things. Get rid of everything that doesn’t need to be there and watch how easy and “fun” it can be.
What have you done to keep things simple?