To be honest I was not tracking expenses till last year and thus if someone would have asked me at that time to show the all expenses, I could not have shown anything except some ATM withdrawals and some Google Pay or Phone Pay payment. Though I manages my investment portfolio very well but managing the expense is what I was lacking.
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I have been earning professionally from last 8-9 years and thus from the last so many years my father has advised me to track the expenses but I have never listened. The drawback of my negligence is that I had done more expense than the savings. But from this year onwards I have been tracking my investment very religiously and thus I can proudly say that I know where my money is flowing. This I think is very much needed for financial stability because you know very much about the inflow and the outflow and thus you can control every thing if you ever wanted.
We al know the old age formula that Income minus Savings should be your expense. And if we enhance that formula and say that if we track the expenses as well than there is a room for more savings. Now people might argue that we have saved, why save more or why track. Now saving money will make your future bright that is no brainer and along with that if we track and know where the expenses are more than we can even save more and increase our saving percentage.
Let's say we earning $100 in a month and our saving rate is 10% that is $10 of it, and if we do not track the remaining $90 then it's very tough for us to increase our savings to 15%.
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So from the last 6 months or so I have increased my savings by 1-2% just by writing down the expense. Because that helped me to go over the months expense and see where I have spent more money. If it is in the good reasoning then fine if not we try to decrease it from the subsequent month. But the only thing is that we do not try to cut our expenses from dairy or basic needs. It is just the unplanned expense which we try to cut down in the next month or if we know that the subsequent month we have some expenses then we try to save 2-3 months before so that our expense should not shoot up on that particular month.
I used to have spending tracker app to keep a track of all my expense, but that didn't work out so now I have a habit of writing down everything in a diary every day or two without fail. And thus every month at the last I will see what exactly is my savings and what is the expense and then tally it with income to see if I am going beyond my expected savings or expenses and try to bring back the savings rate or increase it in the subsequent months.