How to Track Your Expenses Like a Jenius

Jenius Bank Team5/17/2023 • Updated 4/19/2024

Surprised man holding coffee cup and phone with dollars flying away

Does it feel like your money flies away? Tracking your expenses could help. Many people face challenges when tracking their expenses and sticking to a budget. And those challenges could lead to overspending, difficulties building savings, and even increasing credit card balances. Tracking your expenses helps you understand where your money is going so you may be able to identify ways to improve your financial situation and meet your goals. But if you’re not sure where to start, it may feel overwhelming.Let’s take a look at why expense tracking matters and a few actionable tips you could use that may help you start tracking your expenses like a true Jenius.

Key Takeaways

Tracking your expenses is an essential step in creating a sustainable budget and understanding your overall financial well-being.
There are multiple ways to track your expenses, ranging from old-school pen and paper to digital apps.
Once you have a handle on where your money is going, you’re prepared to make adjustments that could support your financial goals.

What Is Expense Tracking?

Expense tracking is the process of monitoring, and even keeping a record of, the money you make and spend each month. Let’s dig into the benefits of expense tracking.

It helps give you a better understanding of your finances: When done properly, it may help you uncover your spending patterns so that you know how you spend your money.
It could help you cut back on costs: When you know where your money is going, you may be able to identify expenses you could cut out or cut back on, which may make it easier to save money in the long run.
It helps you make informed decisions: When you’re armed with the facts, you’re better equipped to make more confident and intentional decisions about your financial goals.

6 Steps for Tracking Expenses

Let’s explore some steps you could take to track your money, help establish a healthy financial foundation, and help build a plan to achieve your short and long-term financial goals.

1. Record Your Income

Before you start looking at your expenses, it’s helpful to understand how much money you’re bringing in each month. That means adding up the income you earn from each income source you have. For example, you want to add the wages you receive from your day job, any dividends you get from your investments, and any money you earn from side gigs or passion projects. Total up that amount and see how much you earn on average each month. Once you’ve recorded your income, it’s time to dive into your expenses.

2. Track Your Spending

Now that you’ve confirmed how much you’re earning each month, you can focus on where your money is going. This process may be time-consuming, but it’s worthwhile. Track every purchase you make over the course of a month. Your purchases may include things like the following:

Rent
Utilities
Insurance
Subscriptions
Eating out
Entertainment
Clothing

The key is to scour all the ways you spend…looking at credit cards, bank accounts, payment apps, etc. Collecting this information shows how much money you’re spending, what you’re spending it on, and how much you have left at the end of the month.You could track those expenses manually or on a spreadsheet… whatever works for you. Or you could streamline the process by using a mobile app to track your spending. According to our survey of 400 millennials, 45% of respondents plan to use a spreadsheet or checklist to track their spending this year and 32% plan to use a financial app.¹

3. Account for Hidden Expenses

Your expenses may change from month to month, so be sure to factor in those unexpected or hidden expenses when tracking your spending. This may mean tracking cash purchases, in-app spending, or fees on bank accounts or credit cards which are often rolled into your monthly statement. Be sure to also account for any semi-regular payments, such as insurance premiums for your car.Make a habit of checking your statements regularly and log any fees you’re being charged or cash purchases you’re making in your preferred tracking method to help you gain a full understanding of your spending.

4. Categorize Your Expenses

As you’re tracking your expenses, you may find it beneficial to categorize your spending. There are a few key categories you may want to focus on.

Category	Description	Common Items
Needs	Essential things you need to live.	Housing/UtilitiesTransportationHealthcare/Life InsuranceGroceriesClothes
Wants	Non-essential expenses you could live without, but they often bring joy.	Home décor Eating out/EntertainmentTravel
Savings	Money set aside for specific purposes.	Emergency fundRetirementPreparing for a purchase
Debt Repayment	Outstanding debts	Student loansCredit cards Mortgage Car loan

5. Build a Budget That Works for You

Once you have an idea of where your money is going and the categories of expenses, use this information to create a budget that works for you. Budgets help you align your spending with your income and your savings goals.There are many budget types out there. For example, the 50/30/20 budget encourages you to spend 50% of your income on your necessities or needs, 30% of your income toward wants like eating out and travel, and 20% of your income toward your savings.²Another common budget is “pay-yourself-first”. This method prioritizes building your savings and paying down debt. Under this budgeting method, you designate a set amount from each paycheck to go into a savings account or debt repayments. The rest of your income then goes toward your other expenses.³You may want to experiment with different budgeting methods to find the one that works best for you.

6. Review Your Spending and Your Budget Often

Spending and income may fluctuate throughout the year. That’s why it’s important to review your spending and budget often. Many people review their spending weekly or monthly while others prefer quarterly. What’s most important is creating a cadence that works for you to review your plan and make adjustments.

Final Thoughts

Once you’ve figured out where you’re spending your money, you may be better equipped to make smart financial decisions and achieve your goals. But finding ways to cut back spending and build up your savings are just the beginning of your personal finance journey. Learn how to achieve financial wellness and set your finances up for long-term success.

Money ManagementLifestyle

Related Articles