How To Track Your Spending

Tracking your spending might take some detective work to start with. Maybe you’ll need to look at multiple bank statements or credit cards. Stick with it! Thankfully there are some tools to help you.

Tools to track your spending

Here are 5 different ideas for how to track your spending.

  1. Apps specifically designed for the task! If you’re in the UK, you might like to use Money Dashboard. We are not sponsored by Money Dashboard! It’s just the one we use but there are other tools that do exactly the same thing. Money Dashboard is completely free. You link it up to your bank accounts and credit cards and it pulls through all your transactions into one place so you can see what you’re spending in total. Katie and I look at our total combined spending so we link all of our accounts into one Money Dashboard account for both of us. It’s up to you whether you do this individually or as a household.
    Download the app, link up your accounts and categorise your spending. The US versions are mint or empower. In New Zealand you can use Pocketsmith.
  2. Use one bank card. Put all your spending through one card so you can use the data on that card to review and categorise your spending.
  3. Banking Apps. Some of the modern banking apps have categorising tools within them so you can track your spending and see where the money is going. Check out your bank account.
  4. Spreadsheet. Just track your spending in a simple spreadsheet! Or try ours – download the Spending Tracker Template
  5. Pen and paper. Good old-fashioned pen and paper and write down everything you spend.

It doesn’t really matter how you do it, just that you do it. Pick the method that you think you can stick to and start to track your spending. We need to know where the money goes!

Once you’ve decided on how you’re going to track your spending you need to categorise your spending!

Categorising your spending

​For each item you bought/spent money on in the last month, categorise it so you can see what areas you’re spending your money on. If you’re using an app, it might have its own categories but you might like to come up with your own.

Choose categories that are meaningful to you. Don’t have more than 10 categories otherwise it becomes too detailed and hard to see what’s going on with your money! We had a friend who had over 30 categories and it was just too much and he spent longer categorising his spending than looking at what he could learn from where his money goes.

I’ve listed the ones we use below. Our categories are particular to our lifestyle and what we typically spend money on. By all means use ours as a starting point but you’ll probably need to adapt them…

  • Accommodation / Housing – Airbnb and hotels
  • Eating out – Restaurants and discretionary naughties
  • Groceries – Food we buy to cook at home
  • Education – Books, courses, videos
  • Transport – All car costs (insurance, services), flights, trains, public transport, car hire
  • Clothes – Clothes, footwear
  • Entertainment – Cinema, shows, cooking courses, spas, fun stuff, renting movies, Thai massages
  • Health – Prescriptions, gym, calisthenics classes, dentist, optician
  • Misc – Cash, gifts, technology and accessories, other random stuff

Try our Spending Tracker Template