Why You Should Track Your Expenses
1. It allows for better planning for the future
Tracking your expenses helps you prioritize spending, track your results, and see what changes you need to make to achieve your goals and create the financial future you want. It also enables you to build an emergency fund, giving you a cushion to fall back on during unexpected events.
2. You’ll become less impulsive
Keeping tabs on how you spend your money gives you a clear picture of how much you’re taking out of your pocket. From there, you can identify the problem areas and cut unnecessary expenses.
Before buying something, ask yourself, “Do I really need this thing, or am I just trying to keep up with my friends on Instagram?” You may be splurging more impulsively than you realize, using funds initially earmarked for more important things. If you track your expenditures, you will be prompted to observe conscious spending.
3. For couples, it helps facilitate a healthier relationship
According to a survey, 36% of couples reported that money is the biggest source of stress in the relationship. It follows that when you get your financial affairs in order, you have one less thing to worry about. Money talk with your partner is one way to eliminate the stressor caused by issues that arise from mindless, unorganized spending.
During this check-in, you get to review your budget and progress on your goals, noting what went well and what needs to be modified. This will allow you to make compromises as a couple, guiding you toward the financial future you desire.
Read: 8 Money Questions to Ask Your Partner
4. You’ll feel less anxious about money
Monitoring your spending also allows you to control your money, as it gives you an idea of how it is being disbursed. This awareness can help you decide how to spend your funds better, paying attention to those areas that need to be prioritized.
When you feel secure about your finances, you will feel less worried about settling your bills and other expenses. This helps reduce stress and anxiety, giving you a more positive outlook on life.
5. It helps you save more
If you’re tracking your spending, you can assess which purchases are necessary and which ones are not. For instance, you may find that you’re no longer using some subscriptions you signed up for a long time ago. As you run through these costs, promptly cancel all subscriptions you no longer need. For other charges, make sure they find a place in your budget.
Read: 5 Luxuries You Can Live Without to Save More Money