Entry #4: September 22,2017 – Tracking Spending Habits
Getting a grip on my spending was one of the most empowering things I’ve done for myself. Last year when I started working on my personal plan for retirement, I realized I didn’t have any clear idea of how much I was spending each month.
I’ve always considered myself fairly frugal, so I wasn’t too concerned about my spending. I’ve always paid my bills, I’ve generally put a little in savings each month, and I’ve have had enough left over to enjoy some small indulgences.
When I retire in 15 months, I’ll have a modest pension and other small revenue sources, allowing me to live a modest life until I can draw full Social Security benefits in a few years. I also plan to generate a few revenue sources after I retire. However, I will not have as much financial flexibility as I do right now. Because of this, I knew something would need to change.
As part of my personal plan, I realized I needed to develop the discipline to track my spending. Last year I created a spread sheet with several spending categories including bills, medical, car expenses, gifts, entertainment, wine (yes, I even have a category for wine), and expenses related to the dog. I committed to recording every cent I spent each day. Then at the end of the month, I total the categories and analyze where my money was going. I was shocked at what I discovered!
I now can see that my “wine” budget” which included two wine club memberships was fun but could be adjusted. I dropped one of my memberships. I do confess, I enjoy good wine. However, I can certainly purchase decent, but much cheaper bottles from Costco when it isn’t a special occasion.
I could also see that our weekly grocery bill is way out of line for two people. I buy things without planning because I’m very busy. I can make adjustments in this area without making a big lifestyle adjustment.
There are a number of other areas where I can make modest changes that will make a big overall difference in my budget needs.
Once I got my system set up, it was easy to do. I’d recommend it for anyone who is making a life change or is anticipating one.