Fall is here and the school year is now in full swing! As you get used to the new school year and the challenges it brings, why not consider how this year will affect your finances? Fall is a great time to set your budget for this year. Whether you have never had a budget or you religiously track each purchase, it is a great to consider or reconsider making a budget that works for this year. This is especially important if you are just starting school, have a new job, new living situation or you want to get a better picture of where you stand financially. Budgeting can help you see how much money you actually have (probably more than you think) and where that money is going (probably more places than you think). This fall join me in the Fall Budget Challenge. Together we will discover our spending habits, align our spending with our values and create a budget that we can maintain, all in just a few weeks!
We begin by discovering our spending habits. Over the next month, you have one task: track your income and your expenses. You may think you know where your money is going, be prepared to be surprised. Over the next few weeks track every dollar that comes in and every dollar that goes out. This includes everything from bills to paychecks to birthday money to the dollar you used to get a diet coke from the vending machine. Every penny counts. There are a variety of ways that you can do this:
- Journal Method: Carry around a small notebook or journal and track every purchase you make whether with cash, credit or check. On another page track your income.
- Excel Method: Instead of using a journal, track all of your income and expenses in an excel spreadsheet. This works best if you set aside some time each week to put in each transaction, if you do it with any less frequency you might forget some of the smaller purchases. This method works best if you keep your receipts from all of your purchases and write down those for which you don’t have a receipt. Microsoft provides a variety of personal budgeting templates.
- Software Method: If Excel isn’t your thing, but you still want to track your spending on the computer there are a variety of different programs out there, one of the most popular is Quicken. This software will also be helpful later when we create a budget.
- Online Method: There are a variety of websites that can help you track your income and expenses as well as create a budget. I use Mint.com because it syncs with my bank account, categorizes my transactions and tracks my budgets all in one place. There is also a great app that allows me to track on the go! Again, it is important that you set aside time each week to track your expenses on the site to make sure everything is categorized correctly and all of your cash purchases are included as well. For more information on other personal finance apps, check out this article.
Join the Conversation: What has been your biggest surprise that you found out about yourself while tracking your spending?