No Time to Budget? Track Your Expenses in 15 Minutes
Everyone knows that they should have a budget in place, but many people resist because they think it will take too much time. While it is true that creating a budget and tracking your household expenses will take a bit of work, it does not have to interfere with the rest of your life.
If you plan things right, you can start tracking your expenses and getting control of your spending in as little as 15 minutes. All you need is a calculator or spreadsheet program, your pay stubs and your checkbook.
You can start by verifying the amount of your net pay as shown on your pay stub. Hopefully you already have a good idea of how much you bring in every month. If not, you can use your pay stubs, bank statements and other financial documents to see exactly how much you make each month.
Once you know how much you have to work with, it is time to see where all that money is going. If you are like so many people who live paycheck to paycheck, you may think there is simply no way to cut back and save any money. The beauty of the budget analysis is that it can help you identify wasteful spending and identify ways to trim those monthly outlays.
The best way to start is by going through your checkbook and recording every check you write, every ATM withdrawal and every electronic payment. You will want to go through several months’ worth of transactions to get a better feel for your monthly spending habits. Going back several months will allow you to capture infrequent – but still significant – expenses. You can easily convert the figures you arrive at into monthly figures by dividing the total figure by the number of months in your analysis.
You can use the information you have just uncovered to look for simple and painless ways to cut back on those monthly expenses. You might find, for instance, that you are still paying for electronic subscriptions you no longer use. Simply stopping that one monthly payment could give you enough money to start a savings account or contribute to your 401(k) at work.
After you are done with your analysis, you can order the latest personal checks and use them to track your spending going forward. It is important to analyze your past spending, but tracking your future expenses is the best way to make sure your budget plan remains on track.