Page 13 - Book3E

spending—that includes the spending of everyone in your household. Don’t try to keep everyone’s records yourself. Even the youngest in your household can make a report on what he or she has spent. Each house- hold member will benefit greatly by tracking his or her own spending. Encourage each one to offer suggestions of ways to improve. Listen to every suggestion, and allow everyone to feel free to express ideas. Once the idea of tracking spending is fully understood and working effectively, it will be the first step to creating new and lasting good spending habits.
How to Track Your Spending
1. To track your spending, the most important thing is to pay on a cash basis for everything. Checks and debit cards can be considered cash. Don’t use your credit cards. Using your credit cards will give you an unrealistic assessment because you are spending money you don’t really have. Paying cash will also help you start controlling immediately how much you spend. Experts have established that once a person makes the commitment to pay with cash only, it becomes easier to avoid compulsive spending. You’ll get an added bonus when you receive your credit card statements and see that the balance due has decreased rather than increased.
2. Track your spending for a complete month. This gives you an accurate picture of a full payment cycle. While you may be anxious to get going on your budget, you can avoid the frustration of an unrealistic budget by first knowing where your money is going.
3. Record everything as it happens. Don’t wait until the end of the day to record what you have spent. Record it as you spend it. If you wait until later, little things can be forgotten. It is critical to know everything you are spending to really gain control of your finances.
4. There are several methods for tracking your spending. A Monthly Tracking Form is included in the Appendix at the back of this volume
A Rose, or a Budget, by Any Other Name 5