It is important to track your expenses. Keeping track of your expenses helps you know how much money you spend.
This would let you know if you have to watch how you spend and spend within a limit.
Without tracking your expenses, you really cannot control your finance.
These are ways to track your expenses.
1. Group your expenses
Grouping your expenses helps you know how much you have spent. There are two kinds of expenses. Fixed expenses and variable expenses.
Your fixed are your regular monthly expenses that really don’t change while your variable expenses are those expenses you can adjust at any time.
List out all your regular expenses. The bills you need to pay regularly like car loans, utility bills, mobile,data plan subscription and so on while your variable expense is the money you spend on food, clothes, travelling etc.
2. Review your expenses
Reviewing your expenses is the next step when tracking your expenses. Look for areas you spent a lot and you can improve on.
Look for ways to save more after you have reviewed your expense.
You can improve your spending by cutting back on some expenses you don’t really need such as fast food and cutting back on drinking.
3. Create a plan
Create a spending plan to make it easy to track your spending.
You need to also set some financial goals like building an emergency fund for any unforeseen issues that may arrive
. The key to planning is to be well-prepared for any eventuality.
4. Make positive changes
Always have it in mind to find ways to create room for positive change in your spending when you are tracking your expenses.
When it comes to tracking your expenses, it can be very helpful to know the right things to spend money on and what to cut out of your expense.
5. Use money tracking apps
It might be difficult to track expenses using a spreadsheet.
Instead of going through the stress of tracking your expenses with a spreadsheet and getting yourself confused, you can download a money tracking app.