Controlling Personal Spending
How many days can you go without spending a dime? Apparently for us, not very many.
My wife and I have decided to make an effort to control our spending this year by writing down all of our expenses for the week on a 3X5 index card. It sounds pretty simple and I can see already that it will be useful as long as we make it a habit.
The preliminary report after three weeks for us is that it’s the little unbudgeted expenses that get us. Surprised?
I can say that we way underestimated our discretionary expenses so far. It’s not the monthly grocery bill or rental payment that catches us by surprise. Its the “Oh, I didn’t think I put $1000 on my credit card this month” that is killing our budget.
Where do these expenses come from? Some are the day to day expenses that creep up as impulse buys and convenience buys. Spending $1.50+ for a cold drink every day adds up, but throw in $40 for a magazine subscription and $15 to mail a package back home and it adds up a lot quicker than I realized.
I hope that the weekly note card technique will provide more rapid feedback than budgeting with Quicken which is what I have used in the past.
You are probably reading this and wondering how in the world did he get through that much school and not realize how much money he has been spending. I like to believe my main problem over the past two years has been because of two bad habits:
- I fell in the trap of justifying my purchases because: “I don’t have the time” or some other excuse.
- The feedback loop between the actual purchase of an item and the transfer of funds from checking to pay the bill was way too long for me to associate the purchase with the pain of paying for it.
Hopefully these little changes in our weekly routine will help us resolve this problem. As is taught in controlling most forms of addiction, the first step to quiting is realizing you have a problem.
This year will be the year we stop paying for convenience, our main problem.
