Tracking your monthly expenses will not always result in saving money, but it will give you a good understanding of where the money is going, and if there are areas you can cut back on.
A few years back my wife and I became interested in how much we were spending per month on going out to eat. Since technology is an amazing thing, we were able to start tracking this through a budgeting website. I became pretty interested in not only restaurant spending, but all of our spending and trends over time. Now that I have a few years of data in tracking our monthly expenses, I wanted to provide some helpful tips and categories to include in tracking your monthly expenses.
It doesn’t take hours a month tracking all of this, maybe 10-15 minutes with good software (most of these sites are offered for free).
There are definitely categories I am missing, but they are fairly insignificant compared to what is included. Any expenses that come directly from my paycheck (health insurance, dental, FSA, 401k etc.) are not included. I also do not include investments like saving into a Roth IRA or 529, as I am only tracking money spent not money invested.
Below are all of the line items that I include in our monthly budget:
- Mortgage
- Fixed amount every month
- Car payment
- Fixed amount every month
- Groceries
- These will vary monthly, but it is quite consistent for us. This went up more than I anticipated now that my son eats real food.
- Real estate taxes
- These are not exactly “fixed”, and for future planning I suspect they will increase.
- Restaurants
- I recommend keeping groceries and restaurants as separate line items. Do not lump together as “food”.
- Auto/Home insurance premium
- Fixed amount every month.
- Entertainment
- This category is highly volatile. Some months it’s very low, and quite high in others.
- Babysitter/Daycare
- This is pretty much fixed every month, and I can pay for it pre-tax with my FSA.
- Gas & Fuel
- Every month is usually within $50 of all the others.
- Shopping
- Also a very volatile category. This does not include groceries.
- Home Improvement
- We don’t spend a lot here, but every time I go to Home Depot it goes into this bucket. If we buy a piece of furniture, I include it here.
- Cell phones
- Fixed every month.
- Electricity
- For the monthly budget I use the seasonal average of prior years.
- TV/Internet
- We have a Wifi streaming cable service.
- Church offering
- Lawncare
- They come out 4 – 6 times a year for to keep the grass thick and weedless, and they can actually do the job cheaper and better than me doing it myself.
- Life insurance premium
- Fixed every month.
- Natural gas
- Low in the summer, high in the winter.
- Trash/Recycling
- Dog expenses
- I budget $50 a month for my Jack Russell, Oliver, but we are usually under that.
- Security system
- Water bill
- Convenience store expenses
- I started tracking this because I see the activity at QuickTrip when I go, and I’m probably a below average visitor for a drink or quick snack. I think more people should track this.
- Septic tank annual maintenance
- This is a once a year expense, and I pay it happily to ensure nothing ever goes wrong with it.
- Gym membership/Yoga
- Annual vehicle registration fees
- Icloud monthly expense
- We have a lot of photos on an Icloud storage plan, which I also back up a few times a year to an external hard drive. This literally costs $1 a month.
- Vacations
- These do not occur every month, but when they do they are worth every penny.
- Gifts
- There always seems to be birthdays/weddings/holidays/baby showers etc.
- Haircuts
- My hair is like my portfolio, doesn’t grow as fast as I’d like.
- Oil changes/Car Maintenance
- You should be able to predict most oil changes and expected maintenance.
- Golf
- I do not golf a lot, but I still like tracking what I spend on it.
- Kid costs
- Costs for my son, Saywer, that fall outside of food/daycare/entertainment.
