(O.M.G. – look at that sexy spreadsheet! Phwoar.)
Ok, I’m lying. Spreadsheets are not sexy – except perhaps to a really niche audience. I do not recommend bigging up your Excel skills by way of a chat up line. Not gonna work.
But spreadsheets are, nevertheless, a vital part of the money mission. To push this analogy to its limits, they are the Spanx of the money world. You need a decent robust spreadsheet underpinning everything and keeping it all together so that you can swan through life looking all sexy and money savvy. Ergo, spreadsheets are sexy.
Step one for me wrestling back control over my finances was to set myself up with a spreadsheet. Now I’m no Excel master. I’ve wrestled with many a table and graph in my time, and rarely do I win. But I’ve picked up a few tricks along the way and on a good day I can plug in a simple formula. This is helpful – it speeds things up. But it’s not vital. A calculator will do the trick too.
Basically the idea is to track your money. Some people call it a budget but actually I think that’s the next step up on the ladder. If you don’t know where the hell your money is going then there’s little point in setting unrealistic limits on what you spend. You’re just gonna blow straight through your budget without even thinking and then give up. Sadly I speak from much experience.
So step one is to track your spending. For a long time I told myself that this was pointless – I can see where the money is going from my bank statement. So why do I need to do the job of the bank and log it all separately myself? Waste-a-time.
Nope. This is your bad money brain talking. Truth is, it is nearly impossible to keep track of all your spending via your bank statement. Particularly if you are hiding from that statement at various points in the month (i.e a week before pay day, right?). Plus a statement doesn’t categorise spending so how are you gonna know just how much your coffee habit (or – because we’re millennials – avocado habit) is actually costing you a month? You might have a guesstimate in mind but chances are it’s wrong.
So: You need a spreadsheet.
There’s a ton of suggestions and pro-formas online for tracking spending which can get you started. I initially started out with one from the ‘Frugal Living’ forum on Money Saving Expert.com, but that was really aimed at setting an annual budget and didn’t really allow me to see where the cash was going each month. So I changed it and made it my own.
I set up a number of categories in columns along the top (which will be entirely personal to you) and put the days of the month down the side. Then I plugged in each item I bought. Yes – each time I bought a packet of crisps or a toy for my kid (or an avocado 🥑🥑🥑) on it went to the spreadsheet.
Now your spreadsheet has to work for you. Mine doesn’t happen to include household spending because my partner and I sort that separately, but it captures all my personal spending, which is the bit that was out of control. Obviously yours can include anything and everything you need.
And then you keep a running total of how much you’re spending in each category along the bottom. And voila – you promptly die of shock at JUST HOW BLOODY EXPENSIVE LIFE IS and that is the best realisation you will come to. Ever.
Because it is not possible to spend mindlessly when you know you have to remember how much a thing cost, in order to plug it into a spreadsheet later. And you become very aware of just how much you’ve already spent in that category this month and, who the hell knew that it all added up to so much anyway?? Jeez!
So, yeah. Spreadsheets. Track your money. Don’t worry too much about budgets just yet. It sounds a bit tedious and it is, but it also becomes mildly addictive. You start to see how you might actually get control of this situation one day and that feels great.
Just don’t expect it to be a great conversation piece at parties, that’s all.