Organizing Your Expenses

Ever sit down and wonder where your money goes? Many of us put a lump sum of cash in our pocket and when that money is gone just withdraw more money from our checking account or use the good ole debit card. Then we notice we have no more money in our bank account and wonder where it all went. We immediately default to "it must have been all the bills this month" or " that doctor visit really took a hit on the expenses". But are you really sure that you know where your money went?

If we could organize our expenses we might notice where we "waste" a good bit of money. It might also help keep us from overdrawing from the bank and save us from penalties.

Let me suggest what I do. This is the process I use all the time. If you only do it for a month it may answer many questions.

First of all, I keep all of my receipts, all of them. At the end of the day I sit down with my receipts and I pull out my checkbook. I write down every expense like it was a check, but in the area where I would put a check number I put a C for cash or an M for charge (MasterCard). I don't jot down everything on the receipt, but I comment what it was for: lunch, doctor, gas, toll, etc.

I should also mention at this point I carry one charge card and $50 in cash. That cash needs to float me for 2 weeks if at all possible. Bigger expenses or unexpected expenses I charge whenever possible and I get a receipt.

When writing things in my checkbook I use more than one "set" of lines some times in the ledger. Usually there are 2 lines per entry. Depending on what I am keeping track of I'll use 3 or even four lines for an entry. This helps with understanding what the money was for.

For example, if you order multiple items from Amazon and they are from different sellers Amazon will show you one amount as the "total" charge. When in fact each item gets charged separately by Amazon for each seller. So when you have Amazon written in your ledger with an amount of $15 for three items and you try to balance this in your checkbook you will not find that charge. Instead you will find 3 separate charges that total $15, all of which will be shown as Amazon, but they may be on different days.

If you write Amazon in your ledger and then, "item 1" $6, then on the next line "item 2" $4, and then a third line "item 3" $5, you will find it easier to balance these charges. You can date each charge individually to know when they were applied to your account as well.

The end result of keeping track of all your money in your checkbook is, at the end of the month, you can write down all your expenses in different categories (like food: groceries, meals, breaks, OR car: gas, oil, tune up, car wash, OR house: electric, water, trash, sewage, rent/mortgage) and see where you may be wasting money. Thus revealing places where you may be able to "save" money.

By Suntydt from Tazewell, TN