Can’t figure out where all your money is going or why you can’t seem to save?

Keeping a journal can help you track and then take control of what’s happening with your money.

Sometimes we don’t realise the $4-dollar coffees every morning or the occasional takeouts can add up to more than $1,000 over the course of a year. Journaling your expenses can make you more aware of your spending habits, helping you identify areas of improvement and reach your savings goals.

Here are 3 ways financial journaling can help you become a more mindful spender.

1. Journaling can help you identify spending missteps

Consider trying an “after-action review” to assess in detail a recent situation. This helps you break down your thought process to identify the triggers that led to your spending decision. The purpose of this exercise is to better understand your spending habits.

Savvy Tip: Start with reviewing a recent spending decision and think about what you would’ve ideally wanted out of the situation, what you actually did and what are the differences between the two actions. Evaluating the two actions and by eliminating the differences may help reduce the number of spending slip-ups going forward.

2. Journaling helps you identify your goals

If you have a savings goal you want to reach by the end of the year, so you can go travelling or saving for your first home deposit, journaling is a great approach to help you get there.

Savvy Tip: Breaking down the big visions into smaller actionable pieces can not only give you a sense of achievement when you reach each progressive target, it can also help motivate you to achieve the next big milestone.

3. Journaling can help you work through uncertainties

Let’s say you have plans to purchase your first apartment, and you have tons of questions and confusion surrounding this topic. Journaling down your hesitations and the reasons behind the uncertainties can provide you the clarity you need to reach a conclusion about your purchase decision.

Savvy Tip: Try and list out the pros and cons for each side of the decision. You’ll then be able to find the answer and work through the uncertainties based on what truly matters to you.

A great way to journal down expenses is to include enough detail so that when you return to your journal at the end of the day or week to do a review, you’ll remember exactly what the money was spent on.

• Date
• Item description
• Amount spent
• What it was for
• How you feel about your spending decision and what you could’ve done differently

So, start taking 15 minutes out of your day, perhaps with your morning coffee or even before bed. It’s as simple as using the good old pen and notebook to start. You’ll find it difficult to note every dollar you spend during the first week, but you’ll start to notice your own spending habits, making you a more mindful spender.

Remember the goal of daily journaling is to help you gain clarity around your own spending habits, so you can make more informed financial decisions.

Once you are aware of your spending habits and make the necessary adjustments to your purchase behaviour, the next thing is to find out where you stand financially to manage and protect your credit reputation.

Here at Credit Savvy, we empower you with your Experian credit score, your Credit Report Summary, and the resources you need to make sense of them both. We’ll also give you tips and tools on how to manage your score and improve it over time.

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