Wednesday, April 6, 2016

The Day I Stop Tracking My Daily Expenses

I have been tracking my expenses daily for the past few years using an app called expenses manager. But... just recently, I stopped tracking once and for all. After a few years of tracking, it has more or less become a habit and it has enabled me to restrict my expenses and save up well for my future. Now the question comes... if its good, why stop tracking?

There are a few reasons and I will list them all out in this article. It doesn't mean I give up managing my money from now onwards. It just means I have come to another stage where I do not need to track as rigorously as how I used to. I will also share what I will do moving forward.

Reason 1: Tracking expenses daily restricts my spending

Yes, its good to reduce and restrict spending so we can have more for our future but having a tight budget and tracking it so rigorously every day really limits my spending. Readers would have remembered the last I posted my income and expenses update, I mentioned that I have doubled my budget which means double the expenses. However, its still too restrictively in my opinion. I have had problems when I realise I spend a little bit more this month or if I realise towards the end of the money that I have spent too much. I began to cut and restrict myself toward the end of the month. This is not the life I want to live.

Reason 2: Tracking expenses daily doesn't make sense for me anymore

When I say it doesn't make sense for me anymore, I mean that even if I track my expenses daily, it does not allow me to save more. Throughout the years, I've built the habit of saving up and for me myself, I don't really spend a lot. I'm really not prone to overspending but more prone to underspending. In fact, now I want to spend more, more on the people around me and the people I love. Ever since I started dating, I knew I had to spend more so I made an effort to double my expenditure budget. In a way, it has worked well in terms of planned spending but still restrictive for unplanned spendings. When I don't spend just on myself, there are many unplanned spendings which I'm not used to. Focusing on a budget will cause a lot of problems for this.

Reason 3: I have gone past the stage of budgeting

I've written a few times on why increasing income is important than just focusing on savings alone. Since last year, I made a goal to increase my income. Not just in my main job income but income from other places as well. I set up a system where it will force me to think of creative ways to increase my income and get me out of my comfort zone. This has worked well so far and moving forward, I will continue to do this which I will elaborate more below.

What I will do moving forward?

So now with the daily tracking of expenses gone, this is what I'm going to do. In fact, I've been doing this but will do it more aggressively now. Previously, I set up auto fund transfer to another bank account so I will not touch the money at all. This was about 75% of my salary being transferred out every month. For the past 1 year, the bank account which had 75% of my salary transferred out did not become empty. In fact, it grew healthily and continue to grow even more. How is this even possible? Does it mean I only spend 25% of my salary every month?

The only explanation that the bank account can still continue to have money inside is this act of fund transfer changed my mindset to increase my income. It is impossible to survive on 25% of my salary only. According to my tracking, I spend close to 50% or more of my salary each month. Income from other sources goes to this bank account as well so any extras which I get, I can actually not worry and be able to spend it all as I already have a fixed amount transferred out for savings every month.

Moving forward, I will be transferring out slightly more than 100% of my salary to the other savings account. This means I would totally not rely on my main job salary for expenses. Let's see how this goes and whether the bank account survives this later on. The transfer will start this month.

Even though I don't track my expenses daily now, I will keep a track of it on a monthly basis instead. Through the transactions on my bank accounts which I can see easily using internet banking online, I can add up all the expenses and get a rough gauge of how much I spend each month. Tracking the expenses monthly will not restrict me to spend lesser towards the end of the month. I can just spend as much as I want as long the expenditure bank account does not become empty. If income manages to increase and I realise I can save more, I will transfer more out and adjust accordingly.

This has been a tough decision to make to give up tracking of my expenses daily which has already become a habit for me. But, after considering all the factors, I decided this is the best way moving forward.


  1. For me, I dedicated one bank account for all household expenses and at the end of month I just download the bank statement and sum them up by a few bank code.

    I just want to know the total monthly expenses to know how much is enough for retirement income. It is more of knowing the number rather than tracking/budgeting for detailed expenses.

    1. Hi Uncle CW,

      Thank you for sharing what you did :)

  2. Hi SGYI

    I guess the habits stay with you for life so you probably don't see the need to do that anymore.

    I don't do that now either, just a rough gauge of how much I spent monthly on items will do in range.

    1. Hi B,

      Glad to know you are doing that too. My main purpose is still to spend more. Haha.

  3. Had you try the 6 account method. Need expensive a/c of 50% to of income (take home pay) , give a/c 10% of income for donations or spent on love one/ buy gift, 10% LTSS long term save and spent for big item (house, expansive holiday or car), 10% of income on play a/c to spend it all anything for entertainment, leisure. 10% of income for investment a/c (money go in only). 10% of income for education or training or course. So I have at last a 6 a/c for different use and credit card for different use. And use auto transfer and online banking for me. Much lesser hazard for me.

    1. Hi seo lim huang,

      This is a good idea also. Thanks for sharing

  4. The way to wealth accumulation is really not tracking your expenses by tracking your savings / investment every month. It's extremely tedious to track expenses daily and nobody should do that. Besides, it's quite useless since the money is already spent, and also quite depressing. It's better to just track one number, saving per month, then spend the rest freely and happily. The fixed amount spent every month can be invested in a certain portfolio which give a certain expected long term rate of return. Then you can plan for your very important long term go like retirement. Just tracking your daily expenses to make sure you don't over spend won't help in achieving goals.

    1. Hi Siak Lim,

      Hmm, in a way you are right too. Focusing on savings should be enough.

    2. siak lim, fully agreed.

      sgyi, that is the right mentality. it's also a mental shift in perspective.

      just beware of the savings paradox.

  5. Hi SGYI,

    I don't track my expenses daily but do it monthly instead, which is something you plan to do going forward. I find that this works better for me since I spend less time and effort tracking all of my expenses but continue to maintain a big picture of my savings rate.


  6. Hi, can share your ideas to increase your income other than dividend and interest from fixed deposit? Thank

    1. Hi Andrew,

      I took up a freelance mortgage consultancy job which increased my income greatly. This was the main boost of income.

  7. Hi SGYI,

    Congratulations for finally attaining enlightenment!
    As a SG Wealth Builder, I have never tracked my expenses because I believe in living a life not trapped by money.
    Welcome to the real world.


    1. Hi Gerald,

      Yes i finally understand it. Let's not be trapped by money

  8. good job sgyi!
    you have moved on! good job on your initiative too!

    years before kyith put on his machines thinking, I plundered this fella for ideas and implemented some of his tips. tweaked it for myself though.