Tracking your Money
Why is tracking your money important to becoming financially stable?
Being able to track your money will give you a better understanding of where you’re spending your money.
Once you’ve identified where you’re spending, you can create a budget to start saving! Simple right?!
So LET'S get started - Where does your money go when you get paid?
When you get your paycheck what’s the first thing you do?
Do you hand it off to someone else to hold on to? A grandparent, parent or friend ?
Do you have a bank account that you deposit it into? Does it automatically get deposited?
Do you cash it immediately and put it straight into your pocket?
Next - Tracking
No matter how/where you deposit your paycheck, YOU need to be able to keep tabs on it for this next part.
If you give your paycheck to a friend, or family member, you need to come up with a way that you’ll be able to track it when you decide to spend it or if they spend on your behalf. This also goes for when you cash your check immediately. Take a week and start to record where you money is going, here’s how you can record your money if it isn’t in a bank account.
Ways to track your money when it’s not deposited in a bank account
Notebook - write down how much you spent, on what you spent and the date you spent it.
Notes in your Phone- everyone has a smartphone these days, type out how much, on what, and the date.
Something that looks as simple as this, will do. You can tailor it to how you will understand it best.
The point of doing this exercise is to know where your money is being spent, once you can collect enough information on where you money is being spent for a month, you will be able to create a budget!
This exercise is great for showing you how your money is moving. Money can move in different ways. Try and remember RSBL, Receive, Spend, Borrow and Lend. These are the four ways your money can be moving from your hand or bank account each month.
The different ways Money can move - RSBL
Receive
Think about what you receive each month, week or 2-weeks.
However much you get paid at your job
SNAP
Section 8
Childcare
Social Security Income
Unemployment Check
Spend
Next think about where you’re spending your money.
Possible areas you might be spending money on:
Bills, which include:
Utilities
Rent
Cellphone
Water
Cable
Groceries
Fast Food
Gas
Cigarettes, Coffee, energy drinks
Child care
Church Donations/Offerings
Donations in general
Things that you have to pay each month, week or 2-weeks etc. For example: Netflix, Amazon prime, Disney +
Borrow
Are you borrowing money from a friend/family member/parents?
How much are you borrowing?
Is it happening every week/2-weeks/month?
When did you discuss paying them back?
Lend
Are you giving out money?
Lending money to parents/relatives/friends/kids
Think about field trips, soccer meets etc.
Are they paying you back?
If so, then when?
If not, then that’s money SPENT
Is that spent money recurring each week, 2-weeks or month?