Oyo, Nigeria
admin@chrestovest.com; rest@chrestovest.com
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  • Oyo, Nigeria
  • admin@chrestovest.com
  • +234(0)9126200191; +234(0)7088155877

Blog Details Title

Time Value Of Money: A Seamless Way Of Making Better Investments And Decisions

Ever met someone meticulous with money? Always calculating and tracking each day’s expenses down to the few notes given out as alms.
“Why bother?” you might have asked.
Although the act looks exhausting, there are tangible reasons why you would keep track of your spending habits.
In this Chrestos insight, we’ll look at the “whys” and the “Hows” of money tracking and how the practice can help you reach your wealth-building destination faster.

Why should you keep tabs on your expenses?

1. Tracking helps identify where you may be overspending: We’ve all been there. Just a few N1K subscriptions, N2k snacks, and boom! Your balance’s approaching one figure. “where did all my money go?” Observing your cash output makes you aware of the true cost of unnecessary expenses.

2. You get to make more informed financial decisions: In continuation with the aforementioned point, when you know the actual cost of certain habits, you’re better equipped to make wiser purchasing decisions, especially when you have dependents. You wouldn’t dream of shutting down clubs when you haven’t saved enough for rent, would you?

3. Tracking is essential to budgeting: As you may know, budgeting is like a monthly money plan where each Naira is maximized for the best possible outcome. The best way to stick to a budget is by tracking your expenses. As we said earlier, tracking your expenditure helps you make smarter decisions with your money. This, in turn, leaves you with more disposable cash, which can be redirected toward the essentials within your financial plan.

How to track your expenses: Now that you understand why documenting transactions is essential; let’s discuss how to track your expenses in three simple steps.

1. Create spending categories: This step requires you to group all your expenses into different categories based on importance or any other scale preferable to you. Examples include, Food, Transport, Subscriptions, Utilities, maintenance, healthcare, etc. Using “categories” serves for neat organization of expenses. They are not meant to replace the recording of each individual expenditure.

2. If it comes out of your pocket–pen it down: This is the hard part–recording. All month long, your transactions should be accounted for. You can do this in a journal or via a mobile app. Today, using mobile apps is more convenient, and they help you build a tracking habit when used correctly. Also, some mobile apps can be linked to your bank accounts, preventing the need for manual entries. Keep reading to see our recommended list of mobile tracking apps.

3. Have a specific day for tracking: This step applies if you prefer to record your transactions manually. If you can’t record your transactions at the end of each day, dedicate one day every week as the “Day of Recording.” Without a “Day of Recording,” there is bound to be a financial day of reckoning down the line.????

Side Note: To get satisfactory results, tracking should be a habit, not a one-time quick fix. 

Suppose you want tracking to become a part of you. In that case, you can take a bite out of Fogg’s Behaviour model which states that “ three elements must converge at the same moment for a behavior to occur–motivation, ability, and a prompt.” 
In other words, the highly motivated you are, the more likely you are to act on a task; the easier a job is, the more likely you are to do it, and coupled with the other two, the more triggered you are, the more likely you are to be prompted to initiate an action or behavior.
Motivation is the “why” of tracking your money. Do you desire financial stability? Are you trying to have a family? Why did you start thinking about tracking your expenses? Hold on to your answers, and always remember them when you’re on the verge of giving up.
Ability is “the quality or state of being able.” Ordinarily, If you can’t meticulously record your transactions, you’ll find it challenging to observe the cash flow. Thankfully, mobile apps exist. However, your “ability to make changes” is still needed when you discover negative financial trends in your purchasing decisions.
A prompt, in this case, is a notification to remind you to track the movement of your finances. Again, this is why using a mobile app is advantageous, as it can give you periodic notification reminders. An alarm clock can do the same trick if you’re old school. Just don’t snooze????
As promised, here are some apps you can use to track your spending:

1. Money Lover

2. Wallet

3. Spendee

4. MyMoney

Give them a try and see which one works best for you. They are available on both Google Play store and the Apple app store.
Happy tracking!

We hope you enjoyed this piece on smart money tracking. If learning more about personal finance and building wealth interests you, consider joining our online community– Rest Trybe.
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