My 1st Million At 33

This is a guest article from Henry @ Binary Dollar. He is a developing writer interested in technology and fundamental personal finance. He also enjoys anything involving clapping.

Tracking what you spend is the most important component of budgeting. I couldn’t build my budget without tracking. I can’t gauge how accurate my budget is without tracking. Here are a few things I do to keep track of what I spend.

Get receipts when possible. Take the receipt and put it in your wallet. Don’t keep it in there to rot.

Keep a pen close. I can’t always get a receipt for something. I keep a pen handy to write down expenses when I couldn’t get a receipt.

Update your spreadsheet ASAP. I have a bad memory and I hate having a fat wallet. Empty your expenses into your computer when you get home so you can throw away the receipts from your wallet. Note: Anything more than 2-3 days old probably won’t get recorded.

Track everything no matter how small. This is especially important if you’re just beginning to track your spending. If you start to make little exceptions, you’ll start making bigger exceptions more frequently.

Purchase what you’ve planned in the beginning of the month. This assumes that you’ve got a little cushion of money. I like to pay rent and utilities, buy plane tickets, fill up on gas, and buy groceries in the beginning of the month. It gives me a more accurate picture of what I have left. More importantly, you get those expenses out of the way early in the month so you don’t have to deal with it later.

Track spending for at least 30 days. Tracking your spending is like exercise. It’s useless unless you do it consistently. Better yet, track it for 3 months. Tracking for 3 months or more will allow you to build a more accurate budget.

Keep your budget sheet with you at all times. I keep an excel spreadsheet (Pearbudget) on a USB stick so I can add an expense when I’m at home, at work, or traveling.

This is the last in a series of 3 budgeting articles. I hope you enjoyed reading them as I did writing them. Big thanks to Frugal here @ 1stmillionat33. Thanks for the exposure.

The other 2 articles:

Effective Budgeting: Why Budget? (Part 1 of 3)
Effective Budgeting: Building A Budget (Part 2 of 3)