It’s not how much you earn, it’s how much you save.
If we can make money every time we hear that line, we would ALL probably be rich by now. The reality though is that most people, if not all, know the importance of saving money but hardly ever take the necessary actions to actually do it IRL.
One good way to save, aside from putting money in the bank, is by tracking your spending. Just by simply taking note of your expenses (deliberately!), you’re able to make a difference in your finances. Sounds good, right?
While some people choose not do it because of the #hassle, this simple money practice can literally change the way you handle your money. Yes, you may have to spend some time to do this, but it can really spare you some money (and future headaches from overspending)!
If that ain’t enough, here are five more reasons why you should track your expenses:
It helps define your financial reality.
You will never know how much you really have to save and spend unless you write it down. Tracking your spending puts your money on record so you know where you stand in your finances. When you’re financially aware, bringing out the budget planner in you becomes easier. After all, it’s hard to budget what you don’t know.
It identifies your spending habits.
We all have that one thing we ~heavily~ spend on, for reals. There are things you buy to make you happy, sometimes to relieve your stress. Others, a reward for a month’s hard work or an A+ on a research paper. While those things aren’t necessarily bad, there is a fine line between rewarding and splurging. When you track your expenses, you get a #realitycheck and then you can adjust for wiser spending!
It teaches you to prioritize.
You’ll never run out of things to spend on. Though what you’ll easily run out of is… you guessed it, money (unless of course, you hit a 1B jackpot or switch places with Bill Gates!). As you track your expenses, you get a clear picture of things that need to stay, and those you can do away (or at least, put on hold). Remember your #priorities!
It forces you to save.
When you track your expenses, you get a good, hard look where your money goes. And so it reminds you also when you exceed your budget (imagine red lights all over, yikes!). Although overspending isn’t exactly good news to celebrate, it’s an opportunity to re-align your lifestyle to your budget. Review your list, and learn to say NO to those impulse buys. It always pays to save, save, save!
It helps you protect your money.
It’s been said that what you don’t know won’t hurt you. That’s true. However, knowing when you lost money is still a better option. At least, you can be proactive and start doing something about it. When you track your expenses, you become aware of suspicious financial concerns like money fraud that you don’t easily notice when you don’t track your expenses.
Financial literacy seems so grand of an idea that often times students like you just settle with their good ‘ol ways. When in fact, it can be as easy as taking note of when you bring out your wallet. As you develop this habit, you’ll see yourself asking less where your money goes, and saving more money you worked hard for.