I’ve tracked every penny our family has spent for the past two years. We get receipts for everything. These go into a manila file folder. On the front of each folder are each spending category (groceries, gas, dining out, rent, etc.). Each expenditure, even the smallest, is listed with the name of the place and date (e.g. under Groceries it might be $34.55 Safeway June 18.
We then track the total expenditures each month. These are analyzed to see where they can be made more efficient. The totals are transferred to an Excel spreadsheet and compared month to month to see how we’re doing.
Knowing exactly where we are financially is a HUGE step to feeling confident about our control over our money. It also makes it very simple to figure out our taxes at year-end. I believe this has been one of the major steps we’ve taken in successfully handling the devastation of the financial meltdown and continued hardship in the economy—along with taking other positive steps such as creating an ongoing, consistent exercise program so we are able to reduce medical costs and have more energy; reducing TV viewing so that our time is used more productively; eliminating or reducing unnecessary things from our life (e.g. comparing and lowering cable TV costs, insurance costs, household purchases); selling stuff we don’t use or need to bring in extra cash and lighten up our load of “things” that weigh us down; and finding new creative outlets to build new careers that will meet the changed environment of the working world.
It’s a whole new world out there. Anyone who doesn’t change to adapt successfully to it will experience many hardships in the future.
