How to Remember Your Expenses
It is often difficult to remember exactly where all your money goes. One way to remember is to look at monthly statements for all the ways you pay your expenses. If you use a credit card, review your monthly statement. As long as it covers a period of about 30 days, don’t worry if the credit card statement straddles two months. Use all of the expenses you see on your June statement for your June expense listing even though the statement and the listing will include charges from May.
If you use your bank account to make payments—whether it is with checks, a debit card, or electronic transfer, these should all be on your monthly bank statement. If something is unclear, ask your bank for more information. Just like the credit card, don’t worry if the bank statement straddles two months, as long as it covers a period of about 30 days. If the bank statement you receive in June covers part of May and part of June, just count all the expenses listed there as June expenses.
Expenses may be harder to keep track when you use a prepaid card. Contact the prepaid card issuer to see how and in what form you can get statements. These may be mailed to you, provided over the phone, or available in electronic fashion. Also keep receipts of money orders and similar payments.
Add up how much cash you receive each month—from an ATM, check casher, cash-back at stores when using your debit card, and the like. Try to remember what you spent the cash on and see if what you remember totals up to the total amount of cash you received that month. An estimate is better than not recording an expense.
Treat as an expense the amount you must pay each month on loans you used to purchase your home, goods, or services—such as student loans, home mortgages, or auto loans. List the amount due as an expense for the month it is due, even if it that month’s payment is made late, early, or skipped. One exception is if you pay off your credit card obligation each month, since you already have listed what you bought on the card as an expense. But if you only make the minimum or other small payment on the card, treat this as an expense.
Listing of Debts. Separate from your listing of expenses and income, it is a good idea to also keep track of your debts. A filled-in sample is found in this chapter and you can see the filled-in sample and a MS Word version you can edit and print out at www.nclc.org/keepingtrack.
This shows you whether you are getting yourself deeper into debt or getting yourself slowly out of a hole. Describing your debts will help you plan which debts to pay first, how much you can pay on your debts, what type of plan you should seek from your creditor to deal with a debt, and the like.
For each debt, list the outstanding balance reported to you in that month’s statement and the monthly payment due. There is value also in determining for each debt the interest rate and by when the loan is supposed to be fully paid off. Include as debts your credit card obligations, short-term loans, loans from friends and family, car loans, mortgage loans student loans, and all other loans.