I need to start tracking our expenses. I hate to admit it but I do not know exactly where all our money is going. A lot of you know exactly your percentages on food, utilites, etc. What has been your way to track expenses? I have looked into the Quicken online. Is it safe when it is connecting to your bank account? I do not know how to do the Excel spreadsheets that I read some of you use. I could just use a notebook but would like more opinions, please.
You could definitely use a notebook to do the expense tracking that I do in Excel. The reason I like to use a spreadsheet is that it stays neat and clean. I tend to smudge and dog-ear my paperwork.
I use a simple Excel spreadsheet to track all our monthly expenses (mine and husband's). The spreadsheet is just like a page in a notebook, with spending categories (Groceries, Gasoline, Federal Income Tax, State Income Tax, Home Insurance, Auto Insurance, Electricity, Restaurant Meals, Investments, etc.) down the left side, and the names of the months along the top. So, each category has one cell that corresponds to each month of the year.
In my expense tracking spreadsheet, the only function I use is the "Autosum" (looks like a backwards Z) to track the total amount of $$ being spent in any given category throughout the year. So, I could tell by the end of June, for example, that we'd spent more than $2,400 on groceries, and realize that we would probably spend $5,000 on groceries this year unless we cut back. Which we decided not to do--but at least it was an informed decision!
I track down and enter every expenditure of $$ by our household. I don't use automatic data entry, although I have nothing against it. I just haven't found any software that suits my purposes. Here is what I do:
1) We use a single credit card for most things. I go on line frequently to check the credit card balance and see where the money is going. Just after the end of each month, I total up the amount on the CC for groceries, gas, etc. and enter that number in the appropriate cell of the spreadsheet.
2) I pay most of our bills by electronic bill-pay. Each time I pay an electronic bill, I enter the amount in the appropriate S/S cell. The exception is, of course, the credit card bill, since those expenses have already been entered into the various categories.
3) Property taxes, certain tradespeople, and my hairdresser have to be paid by check. Each time I write a paper check, I enter the amount in the proper cell on my spreadsheet.
4) Payroll expenses that appear on my pay stub, like taxes and payroll deductions, get entered in the spreadsheet each time I get paid. Same goes for deductions from my husband's pension.
5) We spend very little actual cash. If we spend cash, I'll enter it like any other expenditure - but I have to know about it. Somehow, it's easy to forget when you pay cash. So if there is more than 1 person in your household, everyone needs to sign up to the expense-tracking idea, and notify the Tracker-in-Chief when cash has been spent.
I use a second Excel spreadsheet to track our monthly income from all sources. This allows me to compare "income versus outgo" at any given time, and also come up with those "percentages" you mentioned in your post. I find percentages interesting, but not really useful. What I'm really looking for, with all this tracking, is any "problems" or "bubbles" developing in our spending patterns. For example - is our car starting to cost too much to maintain, relative to its resale value? Maybe it is time to talk about a new car?
This all takes a little time and effort, but believe me, it's been worth it. Good luck with your tracking - let us know know how it goes.
Amethyst
We have a college that has some computer classes, for no credit, and one of them is the Excel class. I had signed up about 6 months ago but they canceled it because there were not enough people who signed up. I will try to find the class in the Spring. For now I am going to keep track, even if it is on a notebook.
