How I track my finances

I’m really into personal finance.

The personal finance subreddit is where I frequent most, just scrolling through to read people’s finance questions and see their budgets.

I’ve always thought about money. My parents had to force me to spend birthday money because otherwise I’d save it in a lockbox under my bed. They never told me why I needed to spend it and I often couldn’t figure out what to spend it on. I never bought much when I was younger and that still persists today.

My mom even bought me personal finance for kids books and a Suze Orman book when I was in high school.

The reason I’m so into personal finance is that I have a fear of not having money. I think about my future a lot and want to make sure I have a nice cushion of money to fall back on in case anything happens. Right now I’m in a stable place, but I still consider ways I could save or make more.

In order to keep tabs on my finance habits I’ve been keeping a spreadsheet to track my spending and income since December 2015.

I can’t remember where I initially got this spreadsheet, but it sounds like something I’d probably see on Reddit and decide to try.

How the Spreadsheet Works

The tabs on the sheet correspond to the year. In that tab, I then break down my budget by month.

Currently these are my budget categories:

  • Gas
  • Eating out
  • Groceries
  • Internet
  • Electricity
  • Rent
  • Insurance
  • Misc. (pet food, clothes, etc.)
  • Haircut
  • Trips

So you can see the top part are my expenses (gas, phone, rent, etc.) and the bottom is my income (work, freelance, etc.). The far right column shows how much of that budget I used.

I automatically put my health insurance in for each month because it’s on auto-pay. For everything else I manually enter it in.

I think this is the key to proper budgeting and why I personally don’t like apps such as Mint. Because we spend so much on credit cards, it’s hard to keep track of what we’re really spending each month.

I save all my receipts and then enter them into my sheet every so often. It doesn’t matter if the receipt is for $1 or $250, I save it.

Once I get paid at the end of the month, I put that into the sheet.

I can see a running total of my expenses for the year and my savings. I try to save at least 50% of my income each month.

This is easier for me than a lot of people because I work from home, I don’t have a car (my girlfriend/fiancee lets me use hers) and we split all bills (groceries, gas, rent, trips).

Why track finances?

I remember when my girlfriend (now fiancee) and I first started living together. There was one month where we went out to eat a lot. We both looked at our credit card statements and it was nearly $600 each! Spending can easily get out of hand if you’re not tracking it properly.

When it’s the middle of the month and I’ve already used up $40 of my eating out budget, then I’m more intentional about where and when to spend the remaining $10. If it’s July 20 and I used up the eating out budget, then I focus on making food at home.

Keeping an eye on these expenses and manually entering them into the sheet gives me a better view of where I’m at each month and how I can adjust my behavior.

What’s Next?

I plan to find another spreadsheet to track my retirement goal. I like to play around with the different calculators online to chart out when I can retire, how much money I need, how much I need to save.

FIRE Calculators

FIRECalc– You can get very granular with this calculator, inputting a lot of different variables.

FIRE Age Calculator– This calculator is very simple, just a few inputs to get a rough estimate of your FIRE age.

If I start doing that regularly, I’ll share that here.