It is one of those things easier said than done: managing your expenses. All of us have trouble with it because we never have enough money to do or have everything we want at any one time. And so we find that we have to make budgets. I bet you have, over the years, become really good at preparing your budget, and even better at not following it. Ask most guys how many times they have made a budget only for them to go beyond what you had planned on using, and you’ll quickly find out you’re not alone.
This, however, is not Spendthrifts Anonymous session; I only wish to share an idea of how to beat impulsiveness. An idea that worked–still works–fine for me.
I came to realize one of the reasons I overspent even after making a budget was because I made an unrealistic budget with false estimates of how much money I used on any one thing. To resolve this problem I decided to put the budgeting aside for one month and instead follow/track my expenses.
It was really easy. I created a simple table on an excel worksheet on which I had the days as columns and different categories of my expenses as the rows. I had a Nokia 2330c phone–I have since upgraded to a 3G model–which had as one of its extras an expense manager. The categories of expenses listed on the phone’s expense are the ones I used on my excel worksheet: transport, food, clothes, entertainment, electronics, accessories, etc. I also added a few of my own.
After creating the table, I would, every day in the evening, record all the money I had spent during the day in the different categories. Now this was some personal stuff that I wasn’t too crazy about letting just anyone see, because I was honest about how I had spent every single shilling that day. One month later I had accurate records of how I spent my money, and making a realistic budget was therefore more than easy at that point.
I’ve maintained this practice ever since and I’ve found that I rarely spend more than I had planned. If I do, however, exceed my budget it will easily be reflected in the records and I make suitable adjustments in the next month. That’s my experience with managing expenses. There is a budgeting guide here for those that need one. Share what budgeting methods that work for you.