Am I spending too much on beer? Eating out a few too many times? Are my expenditures right on budget?
I try to answer these questions by conducting reviews of my expenditures at the end of every month. I facilitate this process by using a credit card instead of cash for all purchases, thus keeping an accurate record of all spending. At every month’s end I download my bill as a comma-separated-value (csv) file and categorize each item (e.g. groceries, car repair, restaurant, etc.). I then create a pivot table using Excel to see how much was spent on beer and restaurants.
I conducted this exercise throughout last year and was able to build a fairly accurate budget for 2007. Here is an example of what my spreadsheet looks like (hypothetical data used).
Sunday, February 4, 2007
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