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Track your Expenses

Track your Expenses

I am very vocal about tracking expenses. If you are serious about your financial growth, then you must start tracking your expenses. It will help you to know where your hard-earned money goes and how much is left in hand. You will understand the trend in which you spend. That helps you to predict your future expenses and equip you for an effective financial planning. Many people have asked me for suggestions/recommendations to track expenses. Here are the ways in which you can track your expenses.

(1) You can write it down in a notebook like good old days. Take a notebook, a pen and start writing your expenses. Ensure to capture the date, amount and a description about the expense. For example, 2/20/2022 - Petrol for Car – INR2000. This is a very simple, straightforward method. The disadvantage of this method is that analyzing the expenses should be done manually and it is time-consuming. The key objective of tracking expenses is to analyze the data to take corrective actions and identify potential areas to reduce expenses. Meeting this objective would be little tiring due to the manual work involved.

(2) You can use mobile apps. There are plenty of apps that are available now-a-days. All you have to do is to download into your mobile and start entering expenses. Tracking expenses through apps helps you to have all information in one place. Analyzing the data is automated. The apps provide reporting options, wherein you can see expenses report within seconds. The report could be month-wise, or expense category-wise based on your selection. For example, if you want to know how much you spent on dining out in hotels for the last six months, you get that report in a jiffy. The apps also provide graphical reports/charts which enable you to compare expenses across months, category etc. However, while using mobile apps, you must be careful about your privacy. Please read their privacy statement before signing up. Some apps would ask you for bank details, credit card information and will also ask permission to sync up with your bank accounts so that the expenses can be automatically populated here. It might hurt your security and if not careful, you might land into financial loss. So, it’s better to use simple apps which don’t ask you to share sensitive information.

(3) Other than apps, and writing down in a notebook, you can use MS Excel or Google sheets to track your expenses. It is in fact a hybrid model of writing down and using apps. You still need to enter your expenses manually like you do it in your notebook. And you can get pivot reports and graphs like in apps. I personally use Excel in my laptop, and it is very convenient in many ways. It is highly customizable unlike apps. There is no threat to privacy and security. At the same time, it offers the convenience of technology. Using Google sheets will give you the ability to access your tracker across devices. If you are using MS Excel, you can upload the sheet to Google Drive periodically so that you can access it across devices.

Having said that, you decide on how you want to track your expenses. But ensure to track. That’s the key. Only when you know where your money is going and how much is going, you could know what is left.

About the Author

Ra Ma. Palaniappan is the author of the book ‘Zero EMI-Unlock Your Financial Freedom’. Ra Ma. Palaniappan was one of the founding members of the Professional Speakers Association of India (PSAI) – an association of the Global Speakers Federation. Academically, he holds an MBA in International Business. Please visit ramapalaniappan.in to know more about him.