Tracking expenses

[longinvest]

We use cash, for day to day expenses (groceries, etc.) and we keep the receipts. All recurring expenses are paid through automated online banking. I track everything, down to the penny, in GnuCash daily (this way, it takes me 5 minutes at most, going through the receipts). Having a clear financial picture has helped us a lot with finding unnecessary money leaks. We now have a nice budget and money to buy things, when we need to. Haven't switched, yet, to modern smart phone thingies.

I originally started with Quicken. Then I learned to use Quikbooks (double entries). Then I switched to GnuCash which I've been using for 10 years.

 

[photoguy]

I track all expenses with receipts and enter manually into spreadsheet (which I prefer over automated tracking). If I don't get a receipt with my cash purchase, I usually send myself an email as a reminder.

 

[longinvest]

If I don't get a receipt with my cash purchase, I usually send myself an email as a reminder.

I like the email idea.

 

[Meadbh]

Until this year I didn't do any of this. I decided this summer that I needed to have a much better handle on personal expenses. With chip cards for debit and credit, I use them almost exclusively now. I keep a $20 bill for emergency cash purchases. I downloaded the information from by accounts to Excel, where I was able to sort and analyze it. So far I have done this just once. I think annually will probably be enough for now. I cannot imagine taking the trouble to document each purchase in real time!

 

[Onward]

I track all expenditures to the penny. Doesn't matter if it's by cash, cc, check, or whatever. I use cash wherever possible, as I feel it has a subconscious, psychological effect that helps curb overspending.

I record expenditures as purchases are made, so I record cc transactions on the day of purchase, rather than on the day the money leaves my account to pay my cc bill.

During each day, expenditures go into a tiny, pocket-sized notebook at home. While running around town I keep receipts which I then use to update my notebook when I get home. I take my notebook with me when I travel, usually leaving it in my room as I am out collecting receipts throughout the day. If I can't or don't get a receipt for a transaction, I have to remember it and the amount till I record it.

At the end of the day, the day's total expenditure goes into a spreadsheet which has one row per day and whose columns are: date, day's expenditure, year-to date expenditure, average daily expenditure year-to-date, and projected annual expenditure based on the current daily average.

I modeled the spreadsheet on the one Billy and Akaisha use and describe in their Adventurer's Guide to Early Retirement. I keep the spreadsheet on an online storage site so I can access it from anywhere, including other countries.

 

[Gumby]

I track all my expenses by category on an Excel spreadseet I built for budgeting purposes. Every time a write a check or spend cash, I enter it in the appropriate category. However, I try to purchase everything/pay all my bills on my American Express card to get the rewards points. (If you have a cash back card, you might want to do that.) It is also easier to track spending when using a card. When I get my Amex bill every month, I manually sort out the expenses by category, sum them and and put them in my spreadsheet. I keep totals by category, by month, as well as a running total by category for the year. I compare these figures to the monthly and yearly budgeted amounts for each category.

 

[Trawler]

We use an excell spreadsheet to track expenses. We have two major buckets. One bucket is for ordinary expenses and one we call capital expenses. The capital expenses are thing like new roof, car, furniture major home impovement etc . All expense line items are catagorized as either essential expenses or non essential expenses. As for cash we have one line in ordinary exp budget for cash and consider it as an essential expense for planning puposes but do not track what it is spent on as we use CC for most things and cash is less than 5% of annnual expenses. Over the years the total amount of cash spent each year has remained about the same.

 

[Walt34]

From time to time we'll track every penny of cash spending but we only do that about two or three times a year just to have a general idea of where the cash is going. For us it is too time-consuming to do that all the time though.

We also keep a spreadsheet listing regular expenses like utilities and all outstanding cc purchases so there are no surprises when the cc bills (all three of them) arrive. When the cc balances approach our allocated discretionary expenditures for the month cc spending stops. Like some others any spending over ~$100 gets at least some discussion just so "the left hand knows what the right hand is doing". And we use Quicken to keep everything balanced and to look at long-term trends.

 

[Bestwifeever]

I think we tried to track expenses when the kids were little but it fell by the wayside pretty quickly. Tracking deficit order here.

I can see where the information would be interesting (especially finding out about the Victoria's Secret purchases) but at this point, for most of you successful FIREs, does it really change your behavior? Do you change your spending habits based on your tracking results, or do you change your budget to accommodate the results?

 

[MichaelB]

I can't track the cash spending. Too much work and not enough motivation. It hasn't varied over the years and we have enough detail on the rest of our spending from credit card and bank statements.

This brings to mind something I saw a few years back. Waiting to get my hair cut, a customer approached the cashier to pay. She asked the amount due, gave a credit card and asked for only part of the amount to be charged, the remainder she paid in cash. After she left I asked the owner if she knew why. Her response - the lady's husband tracked her credit card spending but not the cash and wouldn't let her spend more than "x" amount on hair care.

 

[grasshopper]

Ms G and I track every purchase in Quicken down to a .50 level. It is a lot easier when you only go to the Big City twice a month. We have been doing this since 1995, I can can say that knowing our spending level gave us the confidence to RE. Of course preRE and RE spending is as different as night and day.

 

[easysurfer]

I think we tried to track expenses when the kids were little but it fell by the wayside pretty quickly. Tracking deficit order here.

I can see where the information would be interesting (especially finding out about the Victoria's Secret purchases) but at this point, for most of you successful FIREs, does it really change your behavior? Do you change your spending habits based on your tracking results, or do you change your budget to accommodate the results?

For me, I lean more towards changing my spending habits based on my results.

I'm more interested how well the actual amounts meet my budgeted at the end of the year than the details. The tracking serves as a guide during the year by keeping me honest. For example, if I see I'm spending $3K more on medical costs than planned, then perhaps I'll should cut down and not make a $3K purchase on something else this year.

 

[Finance Dave]

I find the variety of methods here refreshing. Some of us track every penny, all the time. Some of us don't track anything, saying "life is too short". Some of us track carefully for 1-2 months, then don't track again for awhile...just to do a "checkup".

All these ways are valid, IMO, if we think they help us. If you have enough income such that you are able to have a good lifestyle, save for the future, and spend on the basics without tracking expenses...I say good for you. If you track every penny daily and it helps you...I say good for you.

Interesting reading.

 

[Moemg]

I tracked all my expenses for several years pre & post retirement. Now I just monitor my spending and if it gets out of hand I cut back . I have a yearly budget that I never go over.

 

[nun]

I track my spending with the "Spend" app on my iPhone. I like it better than a spreadsheet as I do it as soon as the money is spent, no chance to forget. I immediately enter cash and debit card spending, I enter bills and cc payments when I pay them at the end of the month. The app lets you put the payments in categories and has useful time period and category graphs and statistics.

 

[David1961]

I think we tried to track expenses when the kids were little but it fell by the wayside pretty quickly. Tracking deficit order here.

I can see where the information would be interesting (especially finding out about the Victoria's Secret purchases) but at this point, for most of you successful FIREs, does it really change your behavior? Do you change your spending habits based on your tracking results, or do you change your budget to accommodate the results?

I'm wondering that, also. It's part of why I want to start tracking things closer, for awhile at least. On one hand, just knowing that I have to write it down and track it may make me think twice about buying. But then again, I'm so frugal anyway it may not make much difference.

 

[W2R]

I'm wondering that, also. It's part of why I want to start tracking things closer, for awhile at least. On one hand, just knowing that I have to write it down and track it may make me think twice about buying. But then again, I'm so frugal anyway it may not make much difference.

Maybe it won't make much difference, but if you are like me you are curious and want to know where the money went anyway.

I think that perhaps we have been spending a little less when eating lunch out. Since we are both recording it now, I think we tend to instinctively gravitate towards our less expensive favorite restaurants more frequently.

 

[Corporateburnout]

We track expenses in Quicken. All major purchases are on CC but we don't track the cash spending as we have a "his and hers" category budgeted at $400 per month for both of us. Tracking down to the penny is too cumbersome and unnecessary for our needs.

 

[Trawler]

I think we tried to track expenses when the kids were little but it fell by the wayside pretty quickly. Tracking deficit order here.

I can see where the information would be interesting (especially finding out about the Victoria's Secret purchases) but at this point, for most of you successful FIREs, does it really change your behavior? Do you change your spending habits based on your tracking results, or do you change your budget to accommodate the results?

We found tracking expenses does change some behavior due to to result. Tyically the change is in the form of looking for a better deal as we see some of the steady bills slowly climb like food, cable & cell service, insurance etc. By tracking and watching expenses we still I think consume the same amount of service and goods but have kept total expenses the same for past 5 years so holding our personal inflation in check. Granted some line items are more and some are less but total the same.

 

[Alan]

I don't track cash expenses. The last time I drew out cash was July 7th, when I took out $200. I still have $117 left.

 

[H2ODude]

Since we get 2% back on all things AMEX that's the principal spending vehicle. DW uses cash at a fairly consistent rate; she rolls her eyes at me keeping meticulous track of the investments and expense, so I'm fine not bugging her about where she spends the cash. These days, I'd guess about 3-5% of expense is cash that is not tracked.

 

[youbet]

We think one of the advantages of deep LBYM living is that highly accurate tracking of the smallest bars on your personal spending Pareto chart becomes meaningless, especially during your withdrawal years. 3% - 5% in a misc cash bucket doesn't seem like an issue. Therefore we keep track of items paid by CC, direct deduction or check (because there is little effort involved) but are more than content to let small cash purchases fall into a single misc bucket.

 

[LauAnn]

On the few occassions that I use cash, I make sure to keep the receipt or if none exists I jot down the amount on a scrap of paper. Then once a month when my credit card statement arrives, I record the both the credit card and cash expenditures in an Excel spreadsheet that is segmented into several categories by month.

Where applicable, in addition to the dollar amount I also track the number of gallons, cubic feet, etc. used for such things as electricity, water, national gas, and gasoline.

 

[Sue J]

I keep a spreadsheet of all expenses. It's in Google Documents with DH and I both having access. I use it all the time to record expenses but DH hasn't accessed it since ...... maybe 2009 when I emailed him the password and he accessed it just to make sure it worked. He's just not interested. Sigh.

I used to use a PenFed credit card for everything but in an effort to get DH in touch with our monthly finances he suggested that we go to all cash for things that aren't paid online (except for car gasoline using the PenFed card at the pump). I keep a small file box with the monthly cash in 3 categories (groceries, eating out, and other) and each section has a list of all the expenses that the cash was used for. I track to the penny with a running total. DH knows where this is, does not care to ever go near it and has no idea what we've spent in any category.

We each have our monthly pocket cash that we do not keep track of. I always know where mine went, what I have left and my surplus at the end of the month (I can't think of things to spend it on) goes into a savings jar.

Our lives are very simple so this is not difficult at all. So far this month I've recorded 14 expenses, not counting recurring monthly bills (6) paid online or set up for autopay.

Tracking expenses is easy and I enjoy doing it. DH prefers to be clueless (I've known him since he was 16 and he's always been this way) and he trusts that I'm not frittering our assets away on lottery tickets, a shoe fetish or a boy toy.

 

[palomalou]

My Beloved set up a VERY elaborate spreadsheet in Excel. When we buy anything we get a receipt (unless it is from a vending machine). We also try to enter everything on the day it is spent. Well over 20 years, no big discrepancies. We also spend very little cash. Groceries once a week using credit card, gas every month ditto. It tracks what percentage we are in each account so we can easily see, "Hmmm...perhaps a couple of bean meals this week, food's not looking too healthy." We don't ever look at a flush account and think it's time to spend more in that area, though.