We journal our thoughts and feelings, we journal what we eat, but how many of us journal what we spend? A spending journal is a great way to track where our money is going and get a clear financial picture of our circumstances. It can help us spend smarter, spend less, and make more informed buying decisions. And the best part is, keeping a spending journal only takes minutes a day! Take a look at these helpful tips on How to Create and Keep a Spending Journal, so you can take better control of your financial situation starting today.
How to Create and Keep a Spending Journal
1. Find a journal.
You can’t create a spending journal without a journal, right? Any simple notebook or journal will do! Head to your local Dollar store if you wish and grab a durable notebook. These $2 notebooks from Amazon will also do the trick. Label it as you wish, and you now officially have a spending journal!
2. Decide on the layout.
There are several ways to layout the journal. You can create a page for each day, or create sections using notebook dividers. Use a layout that works for you. If you want to avoid flipping around, it may just be easier to use a new page each day.
3. Track these expenses.
You have your journal, you have your layout, now it is time to decide WHAT should be going in your journal. You want to be sure you include these items each and every day in your journal:
– Outgoing money/expenses
– Incoming money/income
– Essential spending should be written in GREEN
– Non essentials should be written in RED
Basically if you spend a single dime, it gets recorded in the journal. If you earn a single dime, it gets recorded in the journal. It may be ideal to make two columns on each page, one for outgoing and one for incoming. Then, use colored pens (red and green) to decipher spending and record the information in each.
4. Analyze your journal entries each week.
Once you have accumulated a week’s worth of entries, it is time to analyze them. Do your red entries outweigh the green? That could be an issue. You want to see where you might be wasting money. Fast food, coffee shop stops, entertainment, and dry cleaning may be some of the items popping up in red. The gas bill, groceries, and electric bill may be some of the items showing up in green. The idea is to cut the red column down so you can pay off more of the essential expenses.
5. After a month, add a purple column.
After you have the chance to analyze your spending for the month, add one more column. The purple column is where you will put money you SAVED. If you add any money to savings or use a coupon to save on an item, write the savings in the purple column. It will be fun to see that amount grow!
Related: The Budget Binder Kit is perfect for keeping track of your entire household budget.
6. Keep the journal handy.
It is best to keep your journal in a purse or handbag where you can write your expenses down as they happen. If you put it off until the end of the day you might forget and info may not get recorded. Keep the journal handy and you are more likely to use it and keep information up to date.
As you can see, a journal like this can really help you gain financial freedom. Consider creating a Spending Journal to see if it can help you!
Have you heard of a spending journal before? Will you give it a try?