What if one day, as I was crossing the street, I got hit by a Mack truck? Temporarily stunned, I’d lie on the ground, and a crowd would gather to help. No one would know my name, what I did for a living, or what I believed in. But if one of them picked up my checkbook (thrown from my purse by the impact), what would she see? Would those check stubs reveal the kind of person I was? Would they know what mattered to me, based on where I spent my money? —Gloria Steinem, Moving Beyond Words

Several years ago, when I was a single mom with a new coaching practice, I spent my days working hard to make ends meet and my nights nervous about money. What made the stress worse was that I didn’t feel on top of what was happening with my money. Although I rarely went out and made no extravagant purchases, it still felt like the little I earned slipped through my fingers. 

Around that same time, I heard that our local Community Action organization was offering free financial counseling, and I immediately set up an appointment. We took a close look at how much I was earning and spending, created a budget with how much I needed, and set up the tools I needed to track my finances.

Before that one session, I couldn’t tell you how much I was earning or spending. Afterward, at least I was clear. I still needed to earn more in order to feel really secure, but the practice of tracking my income and expenses gave me a sense of safety and relief.

Now, several years later, many of my clients say the same thing. When they first come to work with me, they feel totally lost when it comes to the state of their finances. But by simply getting clear about how much money they have and where it’s going, they find relief from the constant worry and feel like their feet are on the ground again.

So, let’s say you haven’t been tracking your finances, and you want to get started. What next?

I recommend devoting about an hour a week for the next two months to set up and get comfortable with a money tracking system. After that, to stay on top of things, you’ll want to check in with your money at least once a month, though I recommend doing this weekly. Here’s what to do—

First, set up a system to keep track of every cent that you earn or spend. 

I invite you to plan a two-hour date with yourself this week to get started. Here’s what to do during this time—

  • One: Choose a System: I know that some people like using cash and a notebook for keeping track, and if this has worked for you, keep doing what works (though that probably means that you can skip over the rest of this article). However, I know that when I lived in Mexico and only used cash, it was way harder for me to keep track of my spending and be mindful with my purchases. Because of this, if tracking your money is new to you, I encourage you to set up an online system like mint.com and only use debit or credit cards that are linked to the system. This way, you don’t have to remember to write down every single transaction you engage in. (Of course, only use credit cards if you’ll pay them back immediately.)
  • Two: Connect Your Accounts: Connect all of your accounts to the online program and get familiar with the program.
  • Three: Create Categories for Income & Expenses: After you’ve connected the program to your accounts, you’ll likely be able to upload your previous ninety days or so of transactions. Go through your transaction history and choose names for your various income and expense categories and subcategories. 

Then, check in each week.

Once you’re all set up, I encourage you to take the following steps during your weekly money check-in:

  • One: Get centered and comfortable.
  • Two: Record your transactions accurately. Make sure that all of your transactions have been recorded and entered into the appropriate categories. Feel free to edit your categories to more clearly reflect your spending patterns. Finally, total up your expenses and income in each subcategory.
  • Three: Reflect on the numbers and your values. Look at each expense category, notice how you feel, and ask yourself— 
    • Which values did I honor with how I spent my money? 
    • Which values would I like to honor more? 
    • Was the fulfillment and value I received from this expenditure worth the energy that went into earning the money to make the purchase?
  • Four: Make a note of anything you’d like to change in the coming weeks and months.
  • Five: Celebrate yourself for showing up, being willing to look at the hard stuff, and taking baby steps forward. Know that financial change often takes time, and clarity is the first step. As you go through the week ahead, take in the good each time you notice yourself being more deliberate in your money-related decisions.

Making a monthly budget and tracking your finances will help you get clear about where your money is going and how much you need, and it will help you to make better decisions going forward. That is worth celebrating!

I’d love to hear from you—

If you’re familiar with tracking your finances, what are your personal best practices? What works for you? 

And, if this is a new practice for you, what questions do you have? Or, what questions are you taking from this article?

Please post a comment below, and I will make sure to respond!


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