Put your money where your... MIND is

I'm pretty oblivious to how often I spend money. In the past, my money seems goes so many different places that it's impossible to stay on budget, or to have one at all. Of course, it is one of my resolutions to document all of my expenses and create a budget after a month of tracking. This article talks about some "Tips and Tricks to Ensure You Track Your Money." Here is a verbatim taken directly from the site, afterwards I will talk about how I've adapted these bullets into my own expense tracking system:

• Create a system. Make it painless. Come up with techniques that are easy and mindless, and then make them automatic. Develop a routine. Have a place for your receipts and your bills. Follow your system.
• Make the most of on-line banking. Check your account often, and set up as many automated transactions as possible.
• Do your finances regularly. The longer you wait, the more transactions there are to process. The more transactions there are to process, the more intimidating it all seems. Don’t procrastinate. Designate a time to do your finances and do them.
• Develop self-discipline. Ultimately, this is a problem that only you can solve. You must force yourself to track your spending if it’s something that’s important to you.
• Create custom categories. Don’t be hamstrung by the default categories in Microsoft Money. (Or Quicken.) Create categories that make sense for you and your situation.
• Work with a partner. If you’re in a relationship, ask your partner to help prompt you to track your spending.
• Post a visible reminder. Frykitty suggests putting up a graph of your progress. I think that any visual cue should help: a sign, a photo, etc.
  

Create A System: To keep track of my spending, every receipt goes into my wallet. From the gum I purchased at 7-11 to the HDTV I bought over Christmas, they all go in. Personally, coming up with a technique that is "mindless" isn't a good approach to creating a system. When it comes to my finances, it’s out-of-sight, out of mind. Instead, I get really annoyed when I have a lot of receipts in my wallet and want to throw them away. Instead, I created a system to record my receipts and get them out of my wallet. Here is a picture of my complex receipt system:

A cup full of receipts. Not just any cup of receipts, a margarita cup from Bubba Gump Shrimp in Cancun where a man in a gorilla suit with a banjo who was dancing and singing around our table wouldn’t stop staring at me… But anyway, this cup that sits right next to my monitors on my desk is the key to my system. Ideally, I would record my spending and receipts the moment I spent everything. However, for the sake of a realistic system, anytime the cup overflows with receipts, I have to update and record my spending.

Make the most of on-line banking: I already pay my bills and credit cards online. The more important extrapolation from this tip is that nowadays, practically everything can be done on-line. To avoid my out-of-sight out of mind mentality about finances, I’ve done everything I can to make sure I am constantly reminded of them. On my iGoogle page, I’ve installed a gadget from ExpenseView.com (below). This means that every time I open up my web browser, whether it is at home or at work, my expenses are one of the first things I see:

The iGoogle gadget is pretty simple, and I've created custom categories so that expense tracking isn't a hassle to me. Eating out, Bars/Clubs, Entertainment, Clothing, Savings, and Bills. I figure if I have simple broad categories, it will be simple to categorize my receipts. The last thing I want to do is make this too much of a hassle that I end up not doing it. The remaining tips and tricks are encompassed within these first two explanations. This gadget is a visible reminder to record my expenses and having a system helps me do my finances regularly.

I hope this system works. My resolution is to eventually have a budget setup in February after a month of tracking. I want to track my spending meticulously enough that the budget can be accurate and realistic. For now, I think this is a good start.