What are your spending habits?

What are your spending habits? Do you know how much money you spend on electricity, groceries, clothes … each month? And do you have an idea when some yearly/quarterly costs such as for example insurance, or the electricity bill appear?

Until two months ago, my boyfriend and I had a general idea of how much money we spent each month on groceries, clothes, stuff for in and around the house … but we had no exact idea. We also didn’t have the habit to each month reflect back on how much we had spent. So, two months age we started tracking our expenses to get an overview of where exactly our money goes and what our spending habits are.

In the beginning it was a bit of a search to find a good tracking system that worked for us. I started with testing some apps on my Smartphone since I thought it would be easier than on a spreadsheet on the computer or than writing everything down in a notebook. I tried the apps Dollarbird and Accounts 2 Checkbook.

I was immediately quite fond of Accounts 2. It is a very simple and nice app where you can insert your spending day by day, link it to your different bank accounts, and divide your spending in different categories of your choice. I think I liked the app because it is very handy to have an overview of the balance of your bank account (or accounts) on your phone. This overview also helped when I had forgotten to include a purchase and had to check the bank account (which happened a lot in the beginning). The app also allows you to each month retrieve a graph with your spending per category, or you can export a file with all transactions.

I also tried Dollarbird, which is an app that works with a calendar interface. Instead of getting an overview of your bank account, you get an overview of the month and how much money you have spent each day. You can also divide your spending in different categories. It’s a really nice app but I quickly stopped using it since I preferred to use Accounts 2 because of the overview of your accounts.

For the past two months I inserted all our expenses in Accounts 2. In the beginning I often forgot it but after a few weeks it started to become a habit to keep the receipts and include all expenses. Because of this, I can each month retrieve an overview of our spending per category which is super handy and a great way to start spending money in a smart way and budgeting expenses.

In addition to a monthly overview, I also wanted to have an overview of our yearly/quarterly costs. So I decided to include all our expenses in a spreadsheet on the computer to get a more detailed overview than on the app. I made the same categories as in the app, and inserted every expense per month. I also checked my bank account for some big yearly costs such as insurance, the electricity bill… . Then I used a colour scheme to indicate the yearly costs and the costs that return every three months. Here you can find the spreadsheet I made (Expenses).

I’m really excited because with this overview we can exactly predict what our fixed costs are going to be in the coming months. Now we also know which months are going to be more expensive than others due to the addition of several (yearly) costs. A nice consequence is also that now I will know when I have to make my yearly dentist or eye specialist appointment. (Before I never knew how long it had been since my last check up).

With the combination of the app and the spreadsheet I have found a tracking system that works for my boyfriend and I. I don’t know if this system would work for some of you… But if you don’t track your money yet, I would suggest to start with it! It’s really nice to have an overview and to know how much money you actually pay each month on different kind of things. It really helps you to get a sense of your spending and can help you to better regulate how much money you spend on things (for example the things you need and the things you want but not need). In the end it will also help you to save more money …

If you already are tracking you expenses, feel free to share how you do it (with an app, a spreadsheet …). All tips and tricks are welcome.

For now my boyfriend and I will keep tracking our expenses and in a few weeks we will start budgeting.

Regards,
Fiona

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My digital piggy bank

While I was browsing for financial apps, I came across a very nice (and cute) app mypiggybankappfor getting an overview of your savings. I immediately liked it. The app is called “Piggy Bank – Saving Money” created by Georgio Sterk. It is a very simple app that visually shows you how much money you have saved and how close you are to your saving goal. The app is really simple to use, it has an elegant design, and it’s for free.

First you hMypiggybankave to choose for what goal you want to save money and how much you want to save. You can for example save for a car, to buy a house, for early retirement … If you have set your goal, you get a really cute piggy(bank) that shows you how much you have saved and how much remains. At the moment my boyfriend and me are trying to save as much money as we can. Our goal is to save 25000 euro per year. So I entered 25000 euro.

Every time when you then save an amount of money (even a small amount), you insert the numbermypiggybank2 in the app, and you can see the piggy filling up. You can also see how much money you still need to reach your goal. It’s so nice to see the evolution. I just want to save some money and enter the amount in the app, to see the belly of the piggy filling up.

To help you achieve your goal, the app also allows you to calculate how mucmypiggybank3h money you have to save per day, week, month or year. For example, if we want to save 25000 euro in one year, we have to save 2083.33 euro each month. If we succeed to save this amount of money each month we will achieve our goal and the belly of our piggy will be full, yay :). However we are not there yet.

I like the app because its so simple to use and it is beautifully designed with only one goal, showing you how close you are to your saving goal, and how much money you have already saved. For me it really is a visual encouragement to reach my saving goal! I just want to start saving some money and fill that little piggy’s belly! There is however one downside, when you have set your goal of how much money you want to save, you cannot insert a time limit. I for example have a goal for one year, but there is nowhere to include this. I think it would have been a nice addition (for now I will just add in the title that it is my goal for the year 2015). The app also does not show you the history of what you have saved per time period, it just shows you your total. When you want to keep track of the exact amounts you have saved  you will have to use another app or for example keep track of it in an excel sheet.

The app is for free, however, if you want to set more than one goal, you have to upgrade the app for €0.99 (or $0.99). It is available in English and Dutch. Compatible with iPhone, iPad, and iPod touch.

What do you think of this app? Does anyone of you use an app to keep track of your savings?

Regards,
Frugal Fiona

Where to start?

Living frugally, where do I start? I think that I already live quite thrifty, I for example pay attention to what I spend, I use home made cleaning products, I try to limit our waste … but as I mentioned in my previous blog, there’s still a lot of room for improvement.

I think that a good way to start (or continue) living frugally would be by first of all focussing on my spending. I have a sense of how much money my boyfriend and me spend each month, however I have no idea where our money exactly goes to. We can save a lot of money each month but I don’t know the exact amount we give on food, clothes, going out … We’ve created a budget for most household items (such as groceries) but we don’t really reflect back on the accuracy of our estimates. So maybe I have a completely wrong sense of our expenses. It is possible that in my mind several purchases are forgotten or are considered as futile (such as that box of chocolates that I bought yesterday), giving me a completely false sense of being thrifty and could have a big impact on my financial future.

So I think it would be good to start tracking our expenses. Just writing everything down and dividing our expenses in different categories, to get a view of our spending habits (we will definitely need a separate category for chocolates). It would be a good exercise to see where our money goes to, and it will help us to budget our expenses in the future!

At the moment I am figuring out which tracking system would be best. I can for example write everything down in a notebook, use a spreadsheet application on the computer, or use an app. I think I prefer using an app because it allows me to add my expenses on my Smartphone wherever I am.

A quick browse on the internet shows that there are numerous apps that can help me with this, I can enter my income and expenses, divide them in different categories and get a nice overview of what I spend each month for each category. Some apps can even help me to create a budget and tell how much money is left per category. The only ‘difficult’ part is finding a good app since there are so many to choose from. Based on a first quick search me and my boyfriend like dollarbird, spendee and accounts 2, but there are many more so in the following months I will test several money tracking apps including these three and see which one fits best to our needs. I will of course write a review on these apps in the next few weeks. I will also keep you up to date on how tracking my expenses works out for me. My boyfriend and I are very curious to see whether we spend as much money on food, clothes, going out, electricity … as we think we do, or whether we spend much more than we thought.

Regards,
Frugal Fiona