Finance and Buget

September 3, 2005 9:50 PM

Where is all my money going? Does anyone have any clever financing/budgeting tips.

Ok, it's actually not that bad, but I would like some financing/budgeting advice. I am looking for a solid plan and software program to get my finances in order. I really like to see where all my money is going and coming from but don't want to expend a lot of time and effort every day to keep it up today. Any ideas? I have tried making an excel spreadsheet and had better luck with MS money. I have the usual student loans, house/car payments and would like something that could handle all of that and plan for the future. Does anyone have any useful tips, programs, resources you could share with me on this? Thanks.

posted by retro88 to Work & Money (19 answers total)

Read Your Money or Your Life. Follow its instructions (which recommend tracking it on paper.)

But there's no free lunch -- if you want to see where all your money is coming and going, you're going to have to expend time and effort every day tracking it (at least every day you receive or spend any money.) No program or resource is going to change that.
posted by Zed_Lopez at 10:08 PM on September 3, 2005

I wanted to see where all of my money was going, so I started saving my receipts from the day and entering them into an excel spreadsheet at night. It takes all of a few minutes to type in an amount and a small note as to what the money was spent on. I keep my small notes consistent so I can sort the document later (and so Excel will autocomplete the field), but it's amazing. You can start to see spending patterns immediately because transcribing the amounts and looking at what you spent your money on allows you to internalize and reflect on your purchases.
posted by banished at 10:15 PM on September 3, 2005

I did the same thing that banished did, it was terrible to see just how much money I spent on eating out at restaurants. It's those small cost items that really add up.
posted by idiotfactory at 11:38 PM on September 3, 2005

Keeping track of your expenses by category is absolutely the best way to take control of your finances. The patterns are a very important phase of taking charge and building simulations for your goals.
Jgnash is a nice freeware package for organizing and analyzing finances if using a spreadsheet doesn't seem appealing.
Beware of the affordable luxury (eating out, cigarettes, drinks etc)
Good luck.
posted by ptm at 11:57 PM on September 3, 2005

Have you tried using a personal finance manager? SourceForge.net has a whole host of them for several operating systems, free (Jgnash included).
posted by Goblindegook at 12:08 AM on September 4, 2005

lots of credit card companies keep track of different kinds of expenses - like mine files transactions in one of five or six different categories. at the end of the year they send me a snazzy database-generated report that shows how i spent my money. an easy no-work way of doing what you propose is to see if your credit card offers anything like this, and if so, pay for (most) everything with plastic.

caveat emptor: don't be the jerk who uses a credit card for something under a dollar, though.
posted by sergeant sandwich at 12:22 AM on September 4, 2005

I have used Quicken for several years to record all checks, electronic fund transfers, and credit card purchases.
One very nice thing: at the end of the year, all my totals are there for tax preparation, and it is relativlely easy to file electronically.
If you pay cash for a lot of things, you could easily create a Cash Account that would show you how much you spent on lunch, cocktails etc.
posted by Cranberry at 12:48 AM on September 4, 2005

I'm a college student, and a bit of a hardhead when it comes to money, so I generally deal in cash, or, occasionally, a debit card.

A couple of years ago I started using GnuCash (apparently only compatible with linux, unixy things and mac os x). It took me a bit to get used to, but it was free, it taught me a few things about running one's own budget, and it was actually sort of cool to see where my money was going. When I was still doing this, I was living great.

I only stopped using it because I rarely boot into Linux anymore (I need Windows for music software). So Zed is right - if you're not spending a certain amount of time a day logging your cash flow, then it's useless. I haven't done it in months, and I know that my budgeting is much the worse for it. If you can find some freeware program (jgnash?), and get into a ritual of spending ten minutes every other evening doing this, I think your wallet will thank you.
posted by dihutenosa at 2:19 AM on September 4, 2005

"Annual income twenty pounds, annual expenditure nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pound ought and six, result misery."

Charles Dickens, David Copperfield, 1849
posted by nthdegx at 2:40 AM on September 4, 2005

Try checking out this website: http://www.moneysavingexpert.com/
This guy has a tv show in England, so he probably knows what he is talking about. And I found the website quite interesting as I browsed through the other day.
posted by angryjellybean at 5:00 AM on September 4, 2005 [1 favorite]

Without a budget, you just don't know. And once you see, you'll be surprised. But then you can take action and get it under control.

I'll third what banished said. I use Excel - partly because I'm cheap and didn't want to buy something like Quicken, partly because I'm fairly obsessive, and wanted to see/track everything myself.

It's a little work to set up. Then you have to tweak it until you get it right. But after that, it's just a few minutes maintenance when you enter data - every day or so (whenever you spend). Good luck!
posted by ObscureReferenceMan at 6:23 AM on September 4, 2005

<self link>

I wrote a personal finance tracker in Excel. I've been meaning to make a couple of modifications, but the current "release" is actually pretty good, if I do say so myself. It's free, and available at pearbudget.com.

</self link>
posted by Alt F4 at 7:04 AM on September 4, 2005

I'll second the recommendation for Your Money or Your Life. It's become my stock answer in financial threads, but for a good reason. The book is indespensible. Read it. You don't have to live it to the letter, but if you follow its general guidelines, you'll do well with money. It offers some tips on how to track what you spend.
posted by jdroth at 9:08 AM on September 4, 2005

My wife and I just recently abandoned the plastic. We calculated our income and expenses and determined how much we can afford to spend on fun things each week (eating out, drinking, clothes, toys etc), and we take that much out as a cash allowance each week. The cash gives a visual clue of just how much we can afford, and we don't have to worry about spending our rent or food money. I highly recommend this system!
posted by Popular Ethics at 10:23 AM on September 4, 2005

Oh. Um. I realized that I actually have an updated release from the one that's currently hosted at PearBudget.com. If anyone out there wants that newer one, e-mail me.
posted by Alt F4 at 1:31 PM on September 4, 2005

I second Money Saving Expert. UK-based but the budget planner [download a recently updated version from this page] is excellent and pretty universal.
posted by i_cola at 1:41 PM on September 4, 2005

I have a custom Excel spreadsheet I set up to keep track of my budget.

One section tracks my monthly income, minus an approximation of my monthly bills, so I know about how much money I should have left after bills and how much wiggle room I have in my budget. The other section is a running tally of my current bank account balance, minus any money I've spent recently. It takes 2 seconds to enter what I've spent, and it helps me to see where my money is going and how much I have left for the month. I also have a separate page that is has my bills listed down the left side and the months listed across the top, with checkboxes filling out the middle. As I pay my bills, I check the boxes so I can visually see what's been paid and what hasn't.

Also, my bank has an online banking feature that allows me to download my balance and account activity (withdrawls and deposits) in several different formats, including as an Excel spreadsheet. If your bank does that, perhaps you could work that into your budgeting as well.
posted by geeky at 7:37 AM on September 5, 2005

This site just came up in Boing Boing which offers paper containers for your information
D.I.Y Planner
posted by ptm at 7:50 AM on September 5, 2005

I know this is an old thread, but I realized that something was missing from the answers. Hopefully anybody searching through here will find this one, because it is, quite simply, the best way to gain control of your finances. Three simple words:

Pay yourself first.

Seriously. Set up an automatic funds transfer so that when your pay is deposited into your account, money gets transferred to savings accounts (or investments) for the things you need to save for. For example, have a portion of your money (say 10%) deposited into your retirement account, a portion into your child's education account, etc. Do your best to forget that those accounts exist other than to check on them a couple of times a year - the money isn't part of your "daily spending" account, and shouldn't be.

The result of doing this (assuming you get paid at regular intervals), is that you should have very little money left in your "daily spending" right before you get paid, but you'll still have saved money.

I find this system works far better than budgeting every spending category, because once the savings withdrawals have happened, you can do whatever you like with the money that's left, and still come out ahead in the end.

Almost every personal finance book I've read has had some variation of this recommendation, because it's simple and works.
posted by gwenzel at 12:07 PM on January 1, 2006