Habit forming can be awesome. As long as it’s not related to the use of drugs, it is a powerful tool.
Tracking my spending is now a full blown habit, almost an addiction. I do it slightly less often than I used to, but I still do it, and enjoy it. I used to meticulously check and monitor my spending on my excel spreadsheet almost every day. Yes, you read that right. Sometimes I could go a week and check my tedious tracker daily. I would ponder for far too long about what I had spent that hadn’t quite found it’s way to my bank statement, forecasting which pot it would come out of. Looking at remaining budgets and what that meant per week until I was paid. Reading down my budget items seeing where I could improve. I was obsessed. Luckily, these days it’s more like twice a week. I’m not sure there’s a self help group for Personal Finance Addiction.
My PFA aside, I can definitely see how it could be easy to tumble into the trap of stopping this productive habit. Once you’ve paid off your debts and you have a disposable income for investing, things start feeling cushy. I can see how loosing sight of a distant end goal could happen. If the goal is past the horizon, it can slip out of your mind. You can forget about all the little things you used to need to hit those short term targets. No control and another addiction you’re more than used to can take back ahold – spending.
Tracking every penny that is begrudgingly prised from the greedy claws of my bank account still helps to keep me in check.
I look now and I can see this month I have overspent on Alcohol already. This was down to a friends boozey 30th birthday and a wedding I attended. Perhaps I was too flippant with the offers to buy Prosseco by the bottle for my sisters, but so what. All that means I plan to not go out for further frivolities again this month.
I know I have overshot my food budget this month so I’m taking extra care to prepare lunch before work. This can also work wonders for the quality of my diet too.
It works for me. It also helps me focus on the small stuff.
That type of tracking is every month.
This last week, I had a clear out of old clothes, see this post on my thoughts on clutter. Instead of charity donations for everything, I selected one item to list on eBay.
Clearing out some disordered drawers, I was reminded that I had a very nice, very unused wallet. That went on the auction website too.
Both of these bagged me a net profit of over £20. This isn’t going to make me a millionaire, but for very little effort, it does go a way to helping my overspends. It keeps me grounded.
When I’ve overspent on a few items, another trick I use is I reset all of my forecast spending. This means that for any of my headings where I still have money to spend, I change the amount available to nothing remaining. For example, if I haven’t quite spent all my ‘Eating Out’ money, I reset this so I have nothing left. I do this for everything so I can focus on one simple thought. That everything I spend is reducing my investment amount for the month.
It’s the little things. Sometimes.