Budgeting 101- Part 2
Spending

Let's continue on with our budgeting series. If you missed the first post, you can access it here. Our series will follow a specified order, so be sure to catch up.

Being the 1st of July, our assignment this week is very appropriate for what we will be talking about- spending. We can all use a little reality check when it comes to our spending. Just this week, I realized that my deal finds were getting a little carried away. My grocery store has been running triple coupon sales for the last few weeks. I have broken my shopping up into many smaller trips. Just last night, though, I realized that I'd exceeded my grocery budget because I wasn't paying much attention on account of the smaller purchases I was making and the great deals I was finding.

How do you spend? Do you spend whatever cash is in sight? Put all of your purchases on your credit/ debit card and worry about it later? Use cash only? There are so many questions related to how you spend. It's also important to know what you spend money on. These two issues form the basis of a successful budgeting plan. Let's move right on to homework as this month you will be fast at work, tracking your spending habits.



Your goal this month is to track every dollar you spend, every dollar. At times, you might find this task to be a bit tedious and maybe even overwhelming. Are you up to the challenge? Here's how to begin:

• Find a small notebook or binder that can travel around with you in your car or purse. This will be used to track purchases right away.



• Begin the month by spending as you normally would. Make no changes to your current habit of spending.



• Once you spend money, make a note in your binder. You only need to know what the purchase was and the total amount. It's important to write down what you purchased as soon as possible. Not only do we forget things quickly, but particularly if you are accustomed to using cash, you will find that money seems to mysteriously "disappear" if you don't pay attention.



• Categorize your purchases. At the end of each week or at the end of the month, group like purchases. For example, what was the total amount you spent at the end of the month for groceries, gas etc. You might find it easier to track your spending using a spreadsheet like the one found here (MS Excel document). Knowing what you spend on a given month is the start of charting what you plan to spend coming up in future weeks.

Don't scrimp on homework this month. You have a difficult task ahead of you, but it will all be worth it sure enough!

Budgeting 101 Part 1 Budgeting 101 Part 3