In the last few years I’ve developed few habits that I believe are crucial to everyones’ lives. One of the most important one is related to tracking my expenses. It’s been almost 2 years since I started to write down everything I spend my money on and how much I earn. This is crucial because we don’t always know where all our money go and we are sometimes wondering “What happened to the salary I got 2 weeks ago?“. Also, tracking everything helps you be more careful on what you are spending your money on and were you could cut down some expenses that are not vital.

We already know that the things we buy are divided in 2 ~categories: needs and wants.

Needs are things vital to your survival, like food, the place where you live, health, clothes, and so on.

Wants are things you desire, that make you happy (maybe), that you wish for, but that you could survive without.

The big problem is to make the difference between the two, as we are very good at fooling ourselves into thinking that we need the things we actually want. Examples of cases like this are endless, like when you got that new T-shirt saying that you need it, while you already have dosens of T-shirts that you wore only once. Mastering this takes practice. Next time you go shopping think twice (or three, four, five times) before buying anything.

So how do I do it? First of all, I take all the receipts from things I buy and once a week (or whenever feel like), I put everything in a spreadsheet. All my expenses are divided in 8 main ~categories:

  1. Bills
  2. Household
  3. Going out
  4. Health
  5. Apparel
  6. Food
  7. Transport
  8. Misc

I started with a simple spreadsheet that evolved continuously during all this time to better suit my needs. It went from a file stored on my computer to one stored on Dropbox (for easy access from anywhere) to a Google Docs Spreadsheet (even easier to access from anywhere). The structure of the document now shows me the evolution of expenses from each category from one month to another and helps me keep track of my savings, which started to exist now that I’ve developed this habit. Of course there is nothing mentioning debts or loans, those don’t exist in my life.

Recently I’ve decided to share the template of my spreadsheet on Google Docs and surprisingly, there are now 210 people using it (at least this is what Google says). If you want to give it a try to this habit, you can feel free to use this template and let me know if you have any feedback.

For more articles about mastering your financial life, please do go through this collection of articles from Leo at – it is a rich source of tips and tricks an the place where I’ve learned a lot about this subject.