My first two terms of university cost me a little over $20,000. I only know that because I tallied up every bill rather carefully into my budget. Since the term has only just started, I’d suggest that you make it your new year’s resolution (or new term resolution) to start tracking your expenses.
Why? As a university student, you probably already know that it’s important to budget for things. You also know that you need to find money to pay for all your expenses each term, but do you actually know how much money you need each term? Do you ever find yourself thinking that all your money just disappears into thin air? A budget can help with that.
When you start a diet, nutritionists often recommend keeping a diary of everything you eat. It helps you realise where your calories are coming from and how to cut down on the unnecessary ones. Tracking your expenses allows you to do the same thing. Think of your budget like a diet, and your expenses like those pesky calories. I challenge you to record everything you spend money on over the next two weeks. Two weeks isn’t hard right? If you think you’re up for something more challenging, try to remember everything you’ve spent money on so far this term (check bank records and all those online shopping bills laying forgotten in your email account). Tuition, airplane tickets to Waterloo, books, food, rent, that “back in Waterloo” party you had last week, you name it! Keep the approximate date and a short description (e.g. “groceries”) with each item. The goal of this exercise is to get an accurate picture of how much money you’re spending and how you’re spending it.
When you start a diet, nutritionists often recommend keeping a diary of everything you eat. It helps you realise where your calories are coming from and how to cut down on the unnecessary ones. Tracking your expenses allows you to do the same thing. Think of your budget like a diet, and your expenses like those pesky calories. I challenge you to record everything you spend money on over the next two weeks. Two weeks isn’t hard right? If you think you’re up for something more challenging, try to remember everything you’ve spent money on so far this term (check bank records and all those online shopping bills laying forgotten in your email account). Tuition, airplane tickets to Waterloo, books, food, rent, that “back in Waterloo” party you had last week, you name it! Keep the approximate date and a short description (e.g. “groceries”) with each item. The goal of this exercise is to get an accurate picture of how much money you’re spending and how you’re spending it.
Different people use different methods for tracking their expenses. I personally just keep all the receipts in my wallet and then dump them all into a spreadsheet every few weeks. I also double check this with my bank statements. All the expenses that I share with my room-mate are tracked on a handy-dandy website called billmonk.com, so I know how much I need to pay for my share of groceries, for example. If I’m shopping (or drinking…sigh) in a place where I won’t get a receipt then I’ll just write whatever I’ve spent on the back of another random receipt or I’ll just recalculate my spending based on the amount of cash that has disappeared from wallet. I like planning ahead so that I have just the right amount of cash for that evening with me (and a little emergency money) and then I know exactly how much I spend.
There are also plenty of other options. If you’ve got a smart phone (my phone is rather stupid) then I’m sure that you’ll find there’s an app for that! Mint.com has a free budget calculator app to help you. You can also sign up on their website to have them track all your bank accounts if you feel safe sharing your password(s) with them. There are also plenty of other websites out there. If you’re feeling less savvy, simply recording expenses as reminders or notes on your phone also works. Others carry tattered notebooks and pencils around with them. You can also choose to keep a spreadsheet in a google doc active and just record your spending whenever you’re near a computer. Whatever your favourite option is, just make sure it is accurate and that it includes every penny you spend over the next two weeks.
Tracking your expenses is a good habit to get into, so if you already do it, kudos to you! Once you have an accurate picture of where your money is disappearing to, it will be time get it all under control. Look for tips in the next issue for how to actually analyse your expenses, decide where you can trim them down and how you can start saving money for those important (and grown up) things in life.
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