Dude, Where’s My Cash?

By Carlos Gonzales, MoneySense magazine

Posted at Jan 13 2009 02:14 PM | Updated as of Jan 13 2009 10:14 PM

Can’t trace where your money goes? Here are the things you need to do to take control

1. Use your credit card. This may goes the grain of most personal finance advice, but if you’re a responsible credit card user, i.e. you pay your balances in full, then a credit card provides a convenient way of tracking your spending. Monthly credit card statements give you a well-documented way of knowing where your money goes.

2. Keep all receipts. You still have to pay in cash, and that’s the hardest to keep track of. One way to be on top of things is to keep all receipts. This is a good idea even for credit card transactions, as some entries in your statement may be baffling (for instance, store brands or restaurant names that are under less familiar corporate names). You also want to make sure all transactions are legitimate.

3. Keep all bank transaction slips. When you deposit and withdraw, whether over the counter or through an ATM, it gets harder to keep track even after a few days. So keep all transaction slips. Better yet, at the back of your copy, write down where it came from (for deposits) or where you will use it for (for withdrawals). So if you have a check deposit from your customer, write the details at the back of your deposit slip. If you withdraw P5,000 at an ATM to pay for utility bills, do the same. It will take the guess work when you review your bank statement.

4. Write a memo on your checkbook. Your checkbook has a ledger that lets you write the details of each check you issue. Make sure you write the check number, payee, and amount every time you do so. If you’re paying to cash, write at the back of the check the purpose, so you won’t be scratching your head when you get your returned checks.

5. Enter the transactions into the computer. You can get by with a pen-and-paper expense journal that you can update every day. But jotting down each expense as you spend it isn’t very realistic. You’ll more likely be able to track transactions on a weekly basis. Using personal finance software or even just a spreadsheet will keep things in order. But this will only work if you follow tips 1 to 4. Without complete transaction documents and an organized system of keeping and sorting them, you will end just up staring blankly at your computer screen.

This article is from is MoneySense, the country's first and only personal finance magazine. You can read more financial tips and stories at www.moneysense.com.ph.