Why do you need to keep track of your expenses?
This is a question that has been asked many times yet many people still do not keep track of their spending – planned or unplanned.
The responsibility of taking care of your own finances is an important skill to develop. If you don’t learn how to manage your finances, you may find yourself in a very uncomfortable financial situation… CONSISTENTLY.
You may purchase many things over the course of a month, things in isolation, seem trivial… a cup of coffee here – a pastry there. It’s not a lot but when done frequently, by the end of the month, it can add up to more than you realise.
If you don’t keep track of your expenses it is easy to go beyond your income.
I’ll take that coffee to go please… a simple example…
My coffee and me
- Cost of 1 coffee a day = $2.00
- Cost of coffee a week = $2.00 x4 = $8.00
- Cost of coffee per month (assuming 4 weeks in a month) = $8.00 x4 = $32.00
- Cost of coffee per year = $32.00 x12 = $384
No one is saying; don’t enjoy the simple things in life… by all means, do! …but track your expenditure so that you are confident you can afford them.
5 reasons to keep track of how you spend your hard-earned income…
2. Less impulsive spending
3. Awareness of unauthorised charges
5. Increased confidence in attaining financial goals