To be realistic if you want to acquire financial literacy and control over your financial affairs you will need to devote some time to it. Over the years as I’ve grown more mature and gone from being a new worker to a seasoned worker with a mass of debt I had to devote some time to making sure that none of my debts defaulted. This required some minimal budgeting though it was typically just that very minimal. Now that I’m in the process of trying to become more financially literate and have control over my finances I’ve found that it takes a significantly larger amount of time to track and take care of your finances.
The more time you put into knowing what is going on with your finances other your pay is coming up. When I first started this blog I started tracking my expenses in more detail so I could keep more accurate budgeting for it. For this I was literally tracking every transaction and I was able to keep this up for a little while. But in the past month or so I’ve been a bit slack in this. I still collected all of my receipts and had a very good idea where my money went but I didn’t have it in the detail that was necessary. My spreadsheet for expense tracking ended up with holes.
Now the holes in my expense data aren’t the end of the world; I’m trying to teach myself the habit of tracking this information. There will be these minor issues while I get more proficient at it and I was partially expecting this. But what has amazed me is the difference the time makes. Spending the time organizing and cataloging my expenses has allowed me to realize where my money is going and it means that I’m now able to adjust my spending to be more streamlined.
Recently I was reading ‘The Millionaire Next Door’ and they indicated in the book the big difference between how much time the affluent spend on organizing their finances versus people who don’t. The time difference was about 100% (I’m not quoting the exact number because I don’t have the book beside me), regardless the amount was significant and I’m seeing the impact of this personally. Since I’ve started tracking my expenses the time spent on this has gone up but the control I have on my finances has also increased quite drastically. I am seeing first hand the point that the authors of the book were getting at.
[tags]Financial Literacy, tracking expenses, finances,[/tags]