Keeping a Spending Journal

Our family is planning a big vacation next summer, so we’re trying to cut back and start saving now. Sometimes it can seem like there’s just nothing extra to squeeze from the budget! This trip is really important to us, though, so we’ve been looking into ways to save. Sometimes it’s frustrating, because it’s difficult to see our efforts adding up, but I’ve stumbled onto an ingenious way to keep track of our income and outgo: keeping a spending journal.

You may be thinking that writing down every penny spent is not the way you want to spend your days, and I felt exactly the same way when I heard about this technique! I found, however, that it really doesn’t take much time, and after a week or so, it became second nature to write everything down. It also made a huge impact on my spending habits: when I know that I have to be accountable to my spending notebook, I am quite selective when it comes to spending money! Also, it’s really encouraging to see where our money is going, and empowering to make conscious decisions to curb some of the spending.

Have I talked you into giving it a try? You have nothing to lose! You probably already even have a little notebook laying around in which you can write down your expenditures; or, just use your phone. Even if you don’t have a fancy phone, you can always use the notepad feature (my old flip phone had it, and I bet yours does, too!). Try it for just a week and see what happens. Here are a few more tips:

• Use only cash for the week. It’s too easy to forget what you’ve spent when you’re using a debit or credit card. I made two exceptions: groceries purchased during our regular Saturday “big shopping,” and gas, which we also purchased on Saturday. I wrote these amounts directly into our spending journal, with the understanding that if we bought more groceries or needed to get gas again before the week was up, we’d use cash only.

• Write down everything. Yes, even the $1 pack of gum you bought while you were paying for gas, and also the quarters you gave the kids for the gumball machine and the buck you spent at your work vending machine on a candy bar. Everything!

• Go through your spending journal every evening and write down the total of what you have spent. No judgment at this point, just the facts.

• At the end of the week, compile all of your information with an objective eye. If necessary, get a frugal friend to go over your journal with you. Chances are, she will be able to point out places where you are overspending, if you don’t see it yourself.

• Be honest with yourself. While sometimes we have ultra-spendy weeks, such as when three kids in your daughter’s class all celebrate a birthday on the same weekend, or when your washing machine breaks and you have to go to the laundromat twice, most of the time, the little things that come up will keep on coming up. If this is the case, you need to deal with the situation. Are you running late every morning, making it necessary to stop for coffee instead of making it at home? Not planning your grocery shopping well enough, requiring several extra trips to the grocery store each week? Be ruthless and figure out what’s going on!

In most cases, overspending results from disorganization… which is a subject for another post! Getting yourself organized can result in much better financial management, which in turn can allow you to save more money, pay off debt or funnel extra funds where you need them!

Have you kept a spending journal? Did it help you to reign in your spending habits?