Tracking vs. Budgeting
When people try to follow a budget, they typically feel constrained and limited in their choices by pre-set standardized categories.
When you set up a budget you may be making assumptions; you may have preconceived notions about what your categories should be. For example, someone who grew up in a household where money was tight might put strict spending limits in certain categories because they were told as a child, “That’s not a good use of money.”
So, money comes in, and the budget tells you how to spend it. If you “break the budget” for whatever reason, there may be emotional consequences: you might feel guilty for breaking the rules, or take money from another category to cover your indiscretion. You might feel deprived, constrained or out of control. On the other hand, you might find you are under budget and so you go out and buy more stuff just because “It’s okay, I haven’t gone over my budget.”
Tracking your expenses, in contrast, does NOT mean depriving yourself.
The point is to use your monthly tabulation to build awareness in handling money. When you see a money pattern that makes you feel uncomfortable, ask yourself, “Why do I do that?” and the next time you’re about to make that kind of purchase, you remember to think twice and reevaluate. Tracking your income helps you pay attention to the various ways money comes into your life and how you feel about each way.
The purpose of tracking your money on a daily basis is to become more aware – to observe and learn about yourself and your relationship with money. Creating a monthly tabulation helps you to see your patterns in a more concrete way and informs your choices as you move forward.
When you set up a budget you may be making assumptions; you may have preconceived notions about what your categories should be. For example, someone who grew up in a household where money was tight might put strict spending limits in certain categories because they were told as a child, “That’s not a good use of money.”
So, money comes in, and the budget tells you how to spend it. If you “break the budget” for whatever reason, there may be emotional consequences: you might feel guilty for breaking the rules, or take money from another category to cover your indiscretion. You might feel deprived, constrained or out of control. On the other hand, you might find you are under budget and so you go out and buy more stuff just because “It’s okay, I haven’t gone over my budget.”
Tracking your expenses, in contrast, does NOT mean depriving yourself.
The point is to use your monthly tabulation to build awareness in handling money. When you see a money pattern that makes you feel uncomfortable, ask yourself, “Why do I do that?” and the next time you’re about to make that kind of purchase, you remember to think twice and reevaluate. Tracking your income helps you pay attention to the various ways money comes into your life and how you feel about each way.
The purpose of tracking your money on a daily basis is to become more aware – to observe and learn about yourself and your relationship with money. Creating a monthly tabulation helps you to see your patterns in a more concrete way and informs your choices as you move forward.