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Day 1 The Flow of Money

 

LEARN IT

Welcome to Take Control Bootcamp! In these two weeks, we’ll take stock of where you are with your finances and help you figure out where you want to go. The first week will be devoted to assessing your current financial picture and spending habits. The second week, we’ll help you dream up some smart financial goals and work out a plan to transform them into reality. By the end of these two weeks, you’ll feel in charge of your finances, and your money will be on the road to supporting the life you want.

To start, we’ll take a look today at some basic ways of gauging the current state of your finances.

Cash Flow

When you think about the flow of money in your life, some obvious markers probably come to mind: payday, bill due dates, grocery trips, shopping sprees, nights out and more. If we step back from these specific events and take a big-picture view, we might see that money flows in and out of our lives in three ways:

Paying close attention to your cash flow will allow you to grow that last bucket, savings. In order to maximize your savings, you’ll want to earn as much as you can, and spend as little as you can on the things that aren’t your top priorities. The more you save, the more wealth you build and the more money you have for big life goals.

During these two weeks, as we work with you on establishing and achieving your goals, we’ll help you begin to manage your cash flow specifically for building your wealth. By the end of this bootcamp, you’ll start to see your cash flow in a different way:

My LV To-Do

EXTRA CREDIT

Extra Credit

Three Easy Ways to Log Your Spending

The first time I tracked my spending, I was hugely surprised. But not happily so. That’s why I recommend that everyone trying to get a grip on their money immediately start logging their purchases. Luckily, your Financial Inbox logs all your transactions for you, whether they are paid for by credit, debit or cash. It will automatically download every credit and debit purchase, and you can enter cash transactions yourself. This means you can keep track of how you spent the $40 you got from the A.T.M. or note that your friend paid you back $20 for dinner.

If you haven’t linked your accounts yet, do so here. If you’d rather not, you can track your cash spending in one of these three ways:

1. A Notebook

Carry a pocket-sized notebook, and write down everything you spend, taking care to note which purchases are in cash. At the end of each day, categorize each expense (food, transportation, etc.) and tally it up in an Excel spreadsheet or another document you can continually update. At the end of each week/month, calculate your grand total.

2. The Zipper

This is how I do it to this day. I have a wallet with a zipper, and I get receipts for everything. When the wallet is ready to explode (it takes about a week), I log all the receipts and total them.

3. Your Phone

Use an app that will allow you to track your expenses on the go. My favorites:
For the iPhone: iXpenseit, Day Bank and Spend
For Droid: Loot, Spensa Lite and Expense Manager

GET INVOLVED

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  • Mary Pritchard

    My debit and credit card seem to be the death of me. I am contemplating switching to cash-only mentality where I take out X amount of dollars each month and that’s what I get to spend. Anyone do this with success?

    • Anonymous

       Hi Mary,

      Excellent idea! I have definitely done this. However, I recommend doing it weekly rather than monthly. It’s too hard to keep within limits for a full 30 days, and you may end up at the end of the month with several days in a row where you have to go without. If you do it by week, then you can sort of “schedule in” one day here or there when you spend less to compensate for days when you spend more.

      Once I got myself used to my new spending limits, I stopped using cash literally, but I still log my spending to make sure I’m staying within the limits I have set myself per week.

      Let us know if this works for you!
      Laura

      • lobrien04

         Mary,
        I also started doing this using special folders I had set up to divide my cash into categories so I knew exactly how much money I could spend on food, gas, entertainment, etc. Everything was going fine until one day, right after I’d gotten paid and divided ALL of my cash up, my purse got stolen. So, I had to completely rely on my savings account for two weeks (which is never good)! I like Laura’s idea about doing it weekly; that way, if something terrible happens, you’ll still be able to keep afloat with only minor damages. Just be careful and don’t put all your cash in one wallet!

        -LaurenO.

    • Pltnurse

      Using cash for the majority of purchases works well, but there are some items that need a credit/debit card. Using your bank online bill pay, or use a prepaid credit card that has a limit for those items that a credit card is needed for.   I use bill pay from the bank for utilities, insurance premiums, loans, or other recurring expenses. 
            I use something called YNAB.. you need a budget to track all my spending.  It makes a little while to set it up depending on how many accounts you set up.  It tracks anything you make a category for, and analyzes the information to let you know the percentage spent on each category.   Use of any program that helps see where your spending goes, and areas where there can be changes made.

  • Lori

    How is this website different than Mint.com, or Quicken for that matter?  I can log in my purchases, etc..  However, I usually don’t split out my credit card purchases, and that is a huge downfall.

    • Anonymous

      Hi Lori,

      This is a great question. First, LearnVest’s My Money Center is similar to Mint and Quicken in that it shows you information from all your financial accounts and is completely secure. They also all offer a budgeting tool and the ability to categorize your bank and credit card transactions so you can understanding your spending (and earning!) patterns over time. On LearnVest, you can personalize your budget using colored spending folders and set up your transactions so they are automatically filed to the appropriate folder. You can also set up your budgeting folders in a way that makes the most sense to you. I also find the LearnVest Budgeting Tool much easier to use, since it breaks my expenses out into regular bills, savings goals and discretionary spending.

      Lastly, LearnVest offers personalized financial plans and one-on-one access to a dedicated financial planner who can answer any questions you have.

      Laura

    • Kellerbradshaw

      Hi Lori, 

      I have used both Mint and Quicken however I seem to like this one the best. There’s not one perfect solution, just ones that you like the best and fit your needs. This one in my experience has made getting on track easier and more attainable. Hope this helps and good luck! 

  • Salinasbetty

    I don’t keep track of our spending, but I do keep all of the receipts.

  • Jessica

    I’ve always kept a journal/notebook with a strap to keep it secure. I label a page for each month and track all of my monthly expenses. Typically I take a set amount of cash out of the ATM for the month because I have to pay my rent in cash. The rest of the cash I take out is set aside for other expenses that are not bill related (groceries, going-out/entertainment, other). I do not record these expenses because I know their in cash…but maybe I should? Recording all my expenses on LV is VERY helpful for me to see my monthly and yearly picture more clearly.I am paid bi-monthly, so I never realized how much I truly spend in one month.

  • Sml Imaginas

    I’ve decided to commit to doing my expenses each month. Tracking it by category. What I spend on education, writing research, yoga, coffee/cafe, our son, etc. And I love the idea of keeping a notebook and writing down what I spent and where and just logging it in at the end of the day or week into a spreadsheet. Also I put our three financial goals into the notebook to remind myself what I’m saving for so I don’t splurge on things we don’t need.

  • Grace Dobson

    I am going to use the zipper method weekly to see what I am doing with my money.

  • P-Riv

    I have been using Mint and Pageonce for Iphone to try and keep track of my money. I think I’m gonna try the zipper method to see if the helps me also.

  • Underwearshowtime

    Mint for Android

  • SF

    I am going to use the Zipper method to begin with.  I wrote down the iPhone apps to consider later.

  • Rosequartz37

    I save all my receipts and I record the on an envelope with catagories ex.  food, gas, church, ets.

  • Dch1960

    I’m not good with journals so I’m going to use the zipper method to collect receipts and sort them out by the end of each week. 

  • MelissaMain

    check book register and i never (or VERY rarely) carry cash because i don’t have good self control with cash, at least not as good as i do with a card. i too keep my receipts in my wallet until i’m ready to enter them into my check book register.

  • Hmdangel2

    only bringing so much money with me out of the house. Like only bringing five dollars if my goal is not to spend money on more then a drink if needed.

  • Bethksu

    I input it into a spreadsheet every 2-3 days. 

  • Khottle419

    I’m hoping to collect receipts and enter them into a spread sheet at the end of the week.

  • S Hicks

    I think its time I buy a propper purse.

  • Lliggins

    my bank offers a free money manager. it allows me to label all transactions.  but that’s only useful if i do it

  • Tracy Williams

    I’m currently using Lemon–just take a pic and fill in the data. The bank allows me to keep track of all my accounts, as well.

  • Dominique

    iPhone App: Balance Pro

  • Emme

    I used to use Mint.com, but now I just allocate money toward my bills and entertainment from each check and make sure that every dime goes to something–rent, savings, church, etc. This method as seemingly worked, but when I reviewed my budget, I was putting things on credit cards for meals out and coffee runs when the allocated funds ran out.

  • dayesmom

    I think im going to try the zipper method lord knows nothing else has worked time to change my ways

  • Jones_jamelia

    Gonna use the zipper method…..looking for a ziplock baggie now!! LOL

  • India

    I usually throw the receipts in my purse and it ends up a mess but the zipper method sounds a lot better!

  • Manq

    Pay for everything with a cashback credit card. Put all receipts in a basket on the desk and at the end of each week load the transactions into Quicken or just download them and verify.

  • Beverley Rowland

    Most of the time I keep receipts to calculate my spendings but notreally focus on what I spend

  • Beverley Rowland

    I like the notebook method

  • SharonVJackson

    I write every purchase/ expenditure down in a ledger. I keep all receipts in my wallet and record them at the end of the week.I also have an app for my bank on my phone. I categorize them as “Bills” “Necessary”, and “Other”. I pay attention to how much I spend per month on the “Other” category because those are the expenditures that I didn’t count on and they all fall into the “where did my money go” pile. Lastly I linked all my accounts in LearnVest.

  • Kaitlyn Winkler

    Until recently, I was aware that I should track my spending habits but never did. Though I have a few theories as to why and that they still follow me, I am trying to get a better grasp on what I really spend my money on and where I can cut back. 

    To make it easier and a little fun, I created a google spreadsheet for the month and make note of each transaction.  This is the information I included in my purchase tracker. * Date of Purchase * Place
    * Amount
    * Whether it was cash or credit 
    * Category
    I even have a section on how necessary was it and give it a number value as to the degree it was necessary as well as a note section where I can say I got $20 cash back at the drug store or spent $10 of cash I took out of the ATM earlier or money back from a friend. I have been notoriously bad about not carrying cash with me and when I do, it goes so quickly and I cant remember where it goes. This has helped keep track of it. 

    I have done it for a couple weeks and it seems to work well for me. Now that I also know about some of those app, I might check them out and try using those instead. I like the visuals and spreadsheet creation of the iXpenseIt lite. I just downloaded it and will have to see how it works for me. 

  • Ruckus Elise

    I keep track of my spending with YNAB. There is also a mobile app.

  • http://learningaboutmoneyblog.com/ Rhea

    I am going to start simple by saving my receipts and use the zipper method and then see how I get on with that. I’d love to link my accounts, but at the moment I am living in London. I like the idea of then reconciling it all at the end of the week so I can start to better understand where my money is going. I feel like I am not spending very much, but that’s probably not the case.

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