Plus: The register comes ready-made with your checkbook. Ideally, you can record transactions as they occur, adding inflows and subtracting outflows as you go. If you receive your pay via direct deposit, be sure to check with your bank for the exact amount of the transaction before recording it in your checkbook register. This system is the original running tally of income vs. Infrequent expenses may have wide ranges (i.e., going in for an oil change and being told you need new brakes, spark plugs, etc.). Minus: You will have to use this method in conjunction with another method to have a complete picture of your expenses. Seeing all due dates on one calendar can help you be prepared as opposed to surprised when the bill arrives. Plus: This method helps you plan in advance for the infrequent expenses you may forget about. Other expenses that may arise infrequently include car maintenance and routine visits to a physician and/or dentist. Some common expenses that may be billed quarterly or semiannually include water, alarm monitoring, and auto insurance premiums. Use this method to manage large recurring payments and infrequent expenses by writing their due dates on a calendar. If you lose an envelope away from home, chances are it will not return! 3. Minus: This method can get messy if you don’t have a safe place to carry your envelopes. By using cash, you also avoid ATM and overdraft fees. You also can see each balance decrease as you spend, which you cannot see when you use a debit or credit card. Plus: You can have your cash balance (and your balance in each category) at your fingertips. Once you have spent the cash in your envelope, your spending for the category is done for the month (in theory). Set a dollar limit for each category and put the cash in the corresponding envelope. Make an envelope for each category of your cash expenses. After paying large, fixed, and/or recurring items such as rent/mortgage, utilities, and car notes, you arrive at the amount of cash you have left to spend each month. If the observation period is too long, one may easily go over spending limits for each category. The gap between when a transaction occurs and when the transaction is recorded allows time for losing receipts or forgetting to record them altogether. Minus: Not all merchants give receipts without being asked. You can use the receipts to fine-tune your budget. You will get an honest look at your spending habits. Compare the totals against your budgeted amount for each category. At the end of each period (daily, weekly, pay period, etc.), sort the receipts by expense category and record the transactions in a notebook or spreadsheet. This method involves keeping your receipts from every purchase (or ATM transaction) and totaling the receipts periodically. We have put together a list of popular expense tracking methods for you to explore, along with their positive and potentially negative traits. However, there are plenty of alternatives to arriving at how much cash goes out. Since your income figure will more than likely remain fixed during large parts of your graduate or professional school experience, there may be little to no wiggle room with how much comes in.
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