I had a very bad habit of not caring much about my money. I used to spend money but never bothered to keep a track of it. I used to withdraw money from ATM and then spend it without much thought. Whenever I used to spend money, my only intension was to satisfy myself. I never bothered about the worth of the product that I purchased nor did I bother about the value of money. I know it is child like behavior, but I could not tell myself how to stop doing it.
One day I thought, I should keep track of my expenses. (Just out of blue). I know it is weird but I did that one month. I started noting down each and every rupee that I spent. Whenever I made big purchases, I made sure that I do it using the credit card only and started collecting those bills as well. I had written down about 12 pages of my expenditure for a month. It was a nightmare figuring out what I spent on and how much on each of them. It was one hell of a job.
After one month of keeping track of my expenses, this is what I figured it out:
I really didn’t care about expenses which were less than Rs.100. when I started collecting the data; I figured out that I used to spend more money in small amounts rather than a big amount once in a while. This was not a good scenario. I figured out that I had spent nearly 3.5k during the month making small purchases like eating junk food, buying DVDs, spending on chocolates and ice creams, spending on petrol and auto and many more. None of these were given so much importance till then. I used to think that if I don’t spend on something big like buying an electronic gadget worth 3k or more then I can save up. But the truth is that I should be aware of where does my money in small amounts go.
I used to forget money that I lend to friends. I generally don’t lend money. But at times they ask and I used to give them. When I was not noting down, I used to always forget it and even they never bothered about it. I don’t think they did it purposefully but that is how we are. We tend to forget stuff and it is very humane. After noting down, I was sure of what I gave and when and whom. This was actually tracking it. Whenever I got the money back I used to make an entry and I did remind my pals at times to give the money back and promptly they did. It helped me to remember my lending.
Making a note of the money that I spent really made me think on what goods I bought and were they worth my money that I paid for. For instance, I had bought a DVD and that movie sucked big time and I did not even see the complete movie. I spent around 100 bucks to get that but was it worth it? The answer is a big “NO”. I realized that I should not be spending on such things which may not be of worthy of my money.
The most important lesson I learnt is, to plan. This was indeed the best move in my life. I started spending according to a plan and this in turn greatly reduced the worthless expenditure. I was not so very keen on planning but I realized its worth in just few days only. It will cut down your costs as you are spending consciously and making an effort to get the worth of your money. This will indeed help you in the long run to make the best of the choices that you want to do with the money.
Spend wisely and ensure whether you are getting your value for money.
I use Google spreadsheets to note my expenses, and ofcourse, whereever possible use the credit card, and tally at the end of the billing cycle to see where the expenses were unnecessary.
Although i dont spend lesser with these utilities, i spend on much more important things, these days.
All that I want to emphasize is cut down on unnecessary expenditure and save up those money and do something in a constructive way. It is good that you are tracking and if you are spending wisely then that should be fine. BTW, when you say important things, I assume that you buy things that are really important.