Missing Ink: Why You Need To Track All Your Spending To Be Successful

Think about the best piece of financial advice you ever received, and try to remember what it sounded like. Maybe your parents told you that you should save at least 10% out of your paycheck every two weeks. Your grandfather undoubtedly told you as a child to think about every purchase before you decide to buy, if you might want to sleep on it so to speak before your ultimately determine your next cash out of pocket purchase. One element of advice that never gets old, and you’ve undoubtedly heard a hundred times or more is that you have to have a budget to be successful in saving money and spending wisely, as these two items go hand in hand. But when you talk about budgeting, what tends to happen is the proverbial painting with a broad brush. You likely think about this as a spreadsheet of sorts that tackles all the large-scale expenses or the obvious ones, such as the utilities you pay to keep the lights on and the water running but also or the television churning out your favorite shows. Also add to that the car payment, mortgage, and various insurances you carry with you on a monthly basis. And while those are paramount to your budget, those who are savvy when it comes to tracking their spending know that is hardly the end of the story. Probably more just the tip of the iceberg. Budgeting has to be specific, and can’t be something you look at without going deeper and more engaging on exactly where your money is going. What the real smart budgeters do is look at the incidental spending that happens on a daily basis and tracks it for, say six months, and determines that a line item needs to be added to their expenses. If you’re buying $10 worth of coffee five days per week, you had better believe that you need to account for $200 flying out of your pocket on a monthly basis. Most who have a budget and feel as though they’ll come out ahead in the game one month at a time, yet don’t, fail to take into consideration these purchases. Instead, they’ll wonder why they have $1,000 leftover at the end of their budgeted month, only to realize that they’re at break even. Did anyone bother to look at the coffee expenses or perhaps anything else from bottled water to cigarettes? Doing more than the status quo is the difference between a real budget and one that pretends to honestly have your best interests in mind when you’re trying to save money.