After putting it off for so many days , I finally set some time yesterday to dig through my bank transaction details. I took an extract of the last 5 months’ transactions (Oct 3 2012 – Mar 3 2013) in an excel sheet , beautified it a bit and pivoted it for easier analysis. To my utter shock, I noticed that my expenses in these last 5 months were pretty much the same as my income – meaning I was spending almost as much as I earned!
I painstakingly identified each expense and income put down notes against them (Of course it was much easier doing the income side, there was only one broad category: Salary). I then categorized these expenses in broader groups like Groceries, Food (includes any amount spent eating out), Clothes & Accessories, Books, Mobile bill, Internet bill, EMI, SIP etc.
As expected, my biggest expense was the Housing Loan EMI, but my analysis revealed some really crazy facts. I was spending close to 10k a month just on clothes and accessories (including shoes and bags). And then there were so many one time expenses like New year bash bill, fees to Lawyer, Furniture etc. I was spending more than 5k a month on groceries alone . 6% of my expenses were for eating out . Mobile and internet expenses were actually not so much.
A lot of these expenses could have been easily avoided. For example I really didn’t need that 400 Rs. Blueberry Jam I hardly use because it turned out to be too sweet for my liking. Or those baubles I bought and stored away in my cupboard never to take them out. I can say that at least 20% of my expenses are for products/ services that are good to have but not really necessary. The positive side to this exercise is that while I realize that I just went overboard with my spending the last 5 months, I know that there are avenues to cut costs and with a little planning I can save money for more important things. I have even tried to create a monthly budget (which I hopefully stick to).
Guys, this takes about 1 hour to do. I highly recommend each of you to analyze your expenses this way. I am sure you’d be as surprised as well!!
I painstakingly identified each expense and income put down notes against them (Of course it was much easier doing the income side, there was only one broad category: Salary). I then categorized these expenses in broader groups like Groceries, Food (includes any amount spent eating out), Clothes & Accessories, Books, Mobile bill, Internet bill, EMI, SIP etc.
As expected, my biggest expense was the Housing Loan EMI, but my analysis revealed some really crazy facts. I was spending close to 10k a month just on clothes and accessories (including shoes and bags). And then there were so many one time expenses like New year bash bill, fees to Lawyer, Furniture etc. I was spending more than 5k a month on groceries alone . 6% of my expenses were for eating out . Mobile and internet expenses were actually not so much.
A lot of these expenses could have been easily avoided. For example I really didn’t need that 400 Rs. Blueberry Jam I hardly use because it turned out to be too sweet for my liking. Or those baubles I bought and stored away in my cupboard never to take them out. I can say that at least 20% of my expenses are for products/ services that are good to have but not really necessary. The positive side to this exercise is that while I realize that I just went overboard with my spending the last 5 months, I know that there are avenues to cut costs and with a little planning I can save money for more important things. I have even tried to create a monthly budget (which I hopefully stick to).
Guys, this takes about 1 hour to do. I highly recommend each of you to analyze your expenses this way. I am sure you’d be as surprised as well!!
10 comments:
You have made the first step, never late - Congrats, Now you will start saving.
I was like you, buying stuff which was unnecessary.
Stop buying grocery from supermarkets, buy from grocery stores in a market, way to less from the MRP.
All the best.
Sure, I will start doing that... Thanks for your feedback
Deepti- As vinod said you've made a start.. :-)but dont beat urself up over this..
I, being a pesty virgo maintain a sheet every week on expenses and income, tally it at the end of the month.. :-)
I'm an impulsive buyer and most often the highest expenditure is on household stuff - groceries, short-eats and other similar stuff. I also buy a lot from online stores. Well, I always think that I spend very less and also that I could have saved. These two feeling always accost me back-to-back.
Good that you sat down to analyse where the money goes. Makes a huge difference. Do write a post next month on whether you managed to save some money.
All the best.
Joy always,
Susan
Guess what.. i just did the same this month over the weekend and realized pretty much the same as you did..started by sorting out these momentary impulsive buys and trying to cut on them.. Great start i say :)
cool!!dint start earning yet!!may be i should keep an account of how much i spend on treats!!
keep them coming
-muthiah
Me too did the same yesterday with my mobile bill and found that more than 60% of the bill has gone towards a stupid friend! Extracted the call log and emailed saying that I have decided not to waste anymore!
that is way too much analyzing!! :P
Nice work on whole blog. Deeps. Loved your style of expressing yourself.
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hey thanks Ram!
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