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Keeping Good Track of Your Money
and How You're Using It

In addition to carefully estimating  what your income
and expenses will be, you will need to keep a detailed daily record
of any money that comes in, and also when and for what it goes out.

In the Using Money Wisely section, you used the Estimated Monthly Expenses form to determine what expenses you would expect to have during a given month, and you also figured out whether your anticipated income would be enough to pay these expenses.  (And hopefully the answer was "yes!")

Estimating your income and expenses is an important first step, but this by itself is not enough to ensure that you are using your money properly.

You will also need to keep careful daily track of what you actually spend, so you can regularly compare this to what you had planned to spend.  You can do this with a form called the Daily Money Use Record, which you can find and print out  by clicking on Money Use Forms.

Regularly using the Daily Money Use Record will be crucial in keeping you alerted about exactly where your money is going.  This information in turn will help you make any necessary changes in your spending patterns and avoid slipping into the "debtor" category.  On a more positive note, keeping a detailed daily record of expenses will help you determine where slight changes in your spending habits can, over time, result in a growing "nest egg" of  available funds that you can use to great advantage at an appropriate future time.

You might feel that printing out or photocopying enough Daily Money Use Record forms to use every day would be a big and unnecessary expense.  To put things in proper perspective, at 10 cents a copy (or possibly even less), a month’s supply will cost no more than a single hamburger and a side of fries.  This is not a large amount to spend for this purpose, especially since keeping a daily record is the single most important key to properly tracking your overall financial situation and turning it in your favor.

Bottom line:  In order for this approach to work, you will have to record the exact amount of every bit of money you get and spend, no matter how small, and do this on a consistent, ongoing basis.  This is quite easy to do using the following steps.

Filling out the Daily Money Use Record

With a blank copy of the Daily Money Use Record in hand:

First:  Write in the BALANCE FROM YESTERDAY, showing the exact total amount, both dollars and cents, that you had in hand or in your checking account (if any) at the end of the previous day.

If you are just starting to use the Daily Money Use Record, the BALANCE FROM YESTERDAY will be the total amount of money you actually have in hand right now, plus any balance in your checking account, if you have one.  Do not include any savings account funds.

On the day the Daily Money Use Record refers to, if you get any income from any source during that day, write in the total amount on the solid line across from INCOME TODAY.  Show the exact amount (dollars and cents).  INCOME TODAY includes

  • cash money received from pick-up work or any other source

  • the net amount (after tax withholding or other deductions) of any check you actually cashed today, including both the amount (if any) you deposited in a checking account, and the amount you took as cash.  Do not include anything you deposited in a savings account.

  • the net amount of money (if any) that your employer or other agency deposited to your checking account through a direct deposit arrangement.  Do not include any savings account deposit.  (Note:  It's OK to record this amount on your Daily Money Use Record on the day you get a confirmation of the deposit from your employer, even though the actual deposit date may have been a few days earlier.)

To repeat, the INCOME TODAY is the total of the above three items.

Second:  For each category of EXPENSES TODAY, write in the total dollars-and-cents amount you actually spent on that day in that category.  If you did not spend anything on a particular category, write 0.  At the end of the day, add up all the expenses for all nine categories and write this in as TOTAL EXPENSES TODAY.

Third and finally: Calculate and write in the BALANCE TODAY.  The BALANCE TODAY is the BALANCE FROM YESTERDAY, plus INCOME TODAY, minus TOTAL EXPENSES TODAY.

An Easy Way to Keep Track

We strongly urge you to carry a small piece of paper and a pen or pencil with you at all times, and write down every expense at the same time the money leaves your hand (or make sure you have a receipt showing the exact amount spent that you can refer to later the same day).  Do not rely on your memory.  At the end of each day, record all the necessary information from your piece of paper on your Daily Money Use Record.

It is helpful to write in some details about your expenses on the dotted lines for each category.  For example, on the dotted line for FOOD, you might want to make some notes like "breakfast--$2.38," "dinner--$4.76" or for TRANSPORTATION, "monthly bus pass--$95.00."  Notes like this will help you remember exactly what the money was used for, and this will help you in your future money-use planning.

You should periodically compare your actual money use with what you had planned to do with it.  You most likely will have over-estimated in some expense categories and under-estimated in others.  This is quite normal, especially at the beginning.  As you continue with your program, you can fill out a new Estimated Monthly Expenses form for the upcoming month to more accurately reflect what you intend to do with your money over this new time period.

Moving Toward Being a “Saver”

It may be that you have already managed to be at least a modest "saver."  But if you are not yet in the "Saver" category, you can make steady progress toward that goal by carefully and consistently recording and reviewing all your income and expenses.

Your best sign of progress will be a BALANCE TODAY amount on your Daily Money Use Record that gets larger and larger.  At a certain point, the BALANCE TODAY should be big enough to allow you to start regularly depositing a useful amount of money in a bank savings account, while at the same time leaving enough cash on hand to take proper care of your ongoing expenses.

An Important Note:  If you are making significant DEBT/JUDGMENT payments as part of your money use plan, this is actually a good type of "saving," because you are avoiding having to pay additional fees and/or interest on the amounts you owe.  Therefore, if you are making big debt payments, don't worry if the BALANCE TODAY doesn't grow very much for quite a while.  You will still be making good progress on your overall financial picture. 

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