Credit Card Education

Track your spending

Most people think they know where their money goes, but are shocked to discover the truth. Experts say that most people, from all walks of life, spend about 20 percent more than they think they do.

A sure way to find out where your money is going is to track your spending over a period of time. To begin, carry a small notebook and record your daily spending (all of your expenditures, however small).

Use this information to:

• Identify areas where spending can be cut
• Redirect your income toward the things that matter most
• Create a monthly game plan (budget) for your spending

You may find it easier to track spending if you:

• Save your receipts and write on them what was purchased
• Record all cheques and ATM withdrawals in your check register

Track your spending for a month or two, and then ask yourself:

• Where did most of your money go?
• Were there areas where you were surprised by how much you spent?
• Are there areas where you could cut back?

In addition to tracking your spending, determine how much money you are bringing in each month. If you find that your spending is exceeding your monthly take-home income, the next step is to try to cut back on spending.