941931_gym_weights.jpgOnce you’ve started saving money, one of the best ways you can follow through is by tracking compulsively: what you’re making, what you’re spending and how you’re spending it. Of course, like everything else about saving, it’s easier said than done. For some people, all you need to do is keep track of receipts, but if you’re getting a receipt for every single purchase (even if it’s a single pack of gum), sometimes that’s just too many receipts to handle, particularly with the subsequent clutter.

If you’ve made the commitment then, there certainly isn’t a shortage of bloggers offering up advice about tracking expenses: Nina has a thorough article on how and why to track expenses, and J.D. at Get Rich Slowly also weighs in, and there are more if you poke around. Approaching an oft-covered topic is tough, but for me there are some advantages that I haven’t seen covered. Of course, there’s the obvious role of making sure I stay on track for shunting money into my high-yield savings account, but mostly I like to track my spending so I can manipulate my buyer’s remorse to my advantage.

Ok, so most of the time it’s not “real” buyer’s remorse: a lot of times these purchases are less than ten dollars, so not a big deal, right? A tenner is a meal out, so that’s not bad… Once I started tracking my expenses though, I realized that I was making more of these purchases than I realized. They weren’t getting me in trouble: with my system of reverse budgeting I was still saving what I had planned to. The problem was that I was still making purchases that were unnecessary, sometimes for the novelty of it, which can be a bad habit to get into.

Starting to track my budget helped me realize the situations that could lead to spending trouble. My problem spots involve being around stores when I’m feeling antsy or in a hurry, or succumbing to shopping when I need some change in my life. If I had a particularly bad day at work, sometimes heading to stores seemed the only cure. Forcing myself to track my spending on a daily basis allowed me to figure out when these variable expenses were popping up, and, more importantly, why.

It’s also been advantageous in an unanticipated way: I hate expense tracking. It’s kind of like going to the gym, for me. It seems tedious and it takes so much effort to get there, but after a week, when you feel yourself getting stronger, you think “Hey, this might not be so bad.” Just like knowing you’ll need to spend more time at the gym after that second dessert, knowing that I’m forced to own up to my expense, so to speak, makes it harder to spend money frivolously, rather than simply tucking away the receipt and forgetting it.

After starting to track my budget, I was less inclined to make unnecessary purchases, like a snack from a vending machine, and able to use the money saved on something more enjoyable (take-out and a video rental with friends). Expenses like these, or on frequently used items (see Nina’s “cost per use” comment) don’t incite the same buyer’s remorse, and subsequently when I track those expenses rather than guilt I feel confident that I made a good purchase. I’ve had my electric kettle less than forty-eight hours, and I’ve already brewed about half a dozen pots of tea, meaning that in two days the cost per use is already at 8 dollars and dropping fast. I’m not implying that each purchase should be a burden; instead, I’ve discovered that by tracking my money and cutting down on unnecessary purchases, I’ve actually been able to get substantially more enjoyment out of my other more valid purchases.

Some Tools to Help Expense Tracking

If you’re looking to track purchases, I’ve used several mac programs (sorry PC users!); the first one I tried was Burn, which, while free only allowed me to input expenses, which is nice enough but I couldn’t graph expenses versus income. From there, I demoed Coin, which had similar problems and the earlier version I was using was a little confusing. Cashbox was closest, but I found the interface somewhat confusing.

At last, I settled on the web-based Buxfer. Unlike Mint, which Nina mentions, you don’t have to have your financial advice on the web. Instead, all you do is add an account name (I’ve used kitty and ducky) and the starting balance. From there, you can add income, expenses and account transfers, among other things. In summery mode, you can see what you have in all your accounts at once, and the expense tracker breaks down your transactions on a monthly basis based on tags.

With these features, it was incredibly easy to cut down on unnecessary purchases and “find” money that is better off living in a high-yield savings account. And of course, there’s always the Queercents Expense Tracker.