Now that you’ve created your budget, how do you keep it on track?
The key is in diligently recording and tracking your expenses in order understand your spending habits. If you still don’t have a budget, download the Free Budget Planner – 2017 – Exclusive for UAE Residents, draw your budget and come back to read this post.
While a budget helps you set priorities and allocate your income for spending under various heads, tracking expenses helps you understand if the money was spent as budgeted. If you are not sure where your money goes or why and how you are spending, it is difficult to identify the habits you can change to reduce your expenses.
I know it is a boring and monotonous exercise. It might also make you feel guilty sometimes due to over spending on shopping, entertainment, eating out etc…Trust me, it is ok. If you are feeling guilty you are making progress…
Like everything thing else in life, spending within your budget can be a challenge initially. If you remain focused and stay committed to your budgeting goals you will surely succeed.
How to track expenses?
Effective tracking of expenses is one of the common traits of financially successful people and organizations! Tracking expenses could be a monotonous chore for those who do not understand its potential, but for those who understand; it the basic constituent of wealth accumulation and financial independence.
With the advent of technology; recording your expenses is easy. There are many smartphone applications which can help you record your spending easily and immediately after spending.
You can use any app you are comfortable with even the good old pen and paper will do.
Use whatever means you are convenient with, to record and track expenses, on a daily basis. Try to include all expenses, no matter small or big. Using a smartphone application, to instantly record expenses is a very good idea. It takes not more than a minute, and because you can do it instantly, it is less likely you will forget.
If you are not comfortable with the smartphone applications, do not worry, a small notepad, that can fit in your pocket also will do.
Set a reminder
Set a reminder on your smartphone or on your PC/Mac every day at a convenient time to record the day’s expenses. When you are reminded to not ignore, it would only take 2 minutes. Record the day’s expenses immediately. It will become a habit in some time.
Analyze Spending Habits
Keep going don’t lose focus. Once you have at least 3 months of expenses tracked, you will be surprised with the insights, they will provide you.
Use these insights to analyze your spending habits, revisit and review your budget. A positive change in your spending habits can keep your budget on track and improve your financial well-being.
Stay Focussed, Keep Tracking…