Can you place your hand on your heart and clearly outline where your money goes? Most of us think we know where our money is going – but if you aren’t recording your spending regularly most of us have little understanding of where it’s really going. Tracking your spending is the first step in understanding your daily money habits.

The best way to keep track of your spending is to review your receipts against your bank account and credit card statements each month. There are several ways to undertake this exercise. Most banks, via their internet banking facilities, enable you to download your transaction activity onto excel. You can also access several apps that track your spending In doing so, not only will you know where your money is going however you can make sure you’ve been charged the right amount for the items you’ve purchased, and that you haven’t been charged for anything you didn’t buy. Keep an eye out for:

  • Charges from companies you do not recognise
  • Large or unusual charges
  • Changes in regular debit amounts
  • Duplicate charges.

After you have tracked down all your spending you can also group the transactions into several categories to assist you in understanding what areas you are actually spending in. These categories can include:

  • Housing
  • Utilities
  • Education
  • Motor Vehicle
  • Insurances
  • Food
  • Clothes
  • Beauty
  • Fitness
  • Holidays
  • Tax

Once you have completed tracking your spending and understand where every penny goes, and you have categorized these you can then progress to the next level and start up your very own budget.

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