Take the 30-day Personal Spending Journal Challenge

Most people know how much they spend per month on items like rent, groceries, insurance, gas etc. , but do you know how much you spent last month on coffee? What about take out food?  Or lottery tickets?

We’ve all heard the standard, “if you spend $5 at the coffee shop every day for approximately 20 work days a month,  you will have spent $1200.00 in a year”.    Most of us do the obligatory head shake and for about ten seconds promise ourselves to stop spending the $5.  Usually within two days we are back to our regular daily routine.

Why is it that reading these calculations results in only a temporary change?  I would suggest that most of us need something more repetitive to really drive home the point and change our habits.  One strategy is to keep a daily spending journal for at least 30 days.  Buy a mini steno pad or download a free app and record absolutely every penny you spend.  If you go to the variety store to buy a pack of gum, write it down.  If you buy a coffee or dine out, write it down.  Entertainment, cigarettes, lottery tickets, write it all down.

I can almost see the eyes rolling back in the head, hear the collective groaning and yes, I’ve  heard and personally used some of  the excuses: I have enough to do without adding another item,  I always forget to ask for a receipt, I’m just not good at this kind of stuff, my partner handles the money, I’m stuck in my car all day, You only live once, If I can’t buy my morning coffee I’ll end up seriously harming someone!

I concede that most of us lead busy lives but often the truth is that we are reluctant to examine how we spend our money out of fear.  Fear that we may have to make some tough changes or give up something important to us.   There is an emotional component to spending, after all we are only human and once we put our spending on paper there’s no hiding from how our daily routines and habits might impact our finances and prevent us from realizing a financial goal.

Yet the cliche is true.  Awareness really is half the battle.  One study claims that the simple exercise of keeping track of every penny we spend has the effect of reducing our discretionary expenses by approximately 20% without it really even hurting, without even really trying.   That makes sense to me since when we write our purchases down on paper, the brain processes our spending in a different way.  You may recognize, that you’ve dined out twice this week, do you really need to do it a third time?  You may recognize that you regularly spend money on something out of habit, on something that really isn’t even all that important to you but would never have come to that realization without the exercise of writing it down.   Furthermore, if you’re in a situation where you make enough money to pay your bills but you always seem to come up short,  how would you possibly know where to make changes if you don’t have an accurate idea of how and where you spend your money?

 On the flip side you may come to the realization that you habitually spend money on something you’re not, at this moment, ready to give up.  That is one of the main reasons people are resistant to attempt this challenge.  They think by keeping track of their daily personal spending for 30 days a big neon sign suddenly appears above their head flashing, “Spends too much on X, Y and Z.”  But it’s not all about depriving yourself because that won’t work either.  Let me give you an example, if I decide to lose weight by eating nothing but celery, after about three days I’m going to eat a whole chocolate cake!  It doesn’t have to be an all or nothing scenario.  Many of us get into a rigid pattern of thinking along the lines of, “either I go to the coffee shop every day or I can never, ever go again”.  Let’s get real here.  We all know there are a lot of options between those two extremes.  Maybe you go to the coffee shop every other day, maybe just once a week, maybe instead of the large you buy the small.  For the record, most mornings I make my own coffee and I slurp out of that cup like it was the ichor of life but the times when I buy my coffee I try to be a bit of a drama queen about it.  I relish the aroma, I feel the warmth of the cup in my hands, I savour the flavour!   Sounds extreme, I know, but after all this exercise is about awareness, about waking up your brain to recognize that you actually are having a TREAT.  Buying a coffee or your lunch every day is not an automatic entitlement.  We are so entrenched in our daily routines that our brain has our daily purchase of coffee mixed up with breathing (although some days I would argue my morning coffee ensures others keep breathing).

Ideally each adult in the house should take this challenge and at the end of the thirty days come up with two items they are willing to reduce or eliminate from their personal spending.  In this way you’re being responsible for the contribution you’re making to the common financial goal rather than one partner telling the other “You spend too much money on X “ only to hear in response, “Well what about the money that YOU spend on Y?”  That type of conversation is the Neon Sign and while at times shame can be a motivator, you’re supposed to be on the same team, not playing defence to the “offence”.  Once you commit to the change, find a way to hold yourself accountable such as a weekly meeting with your partner or an automatic withdrawal at the bank from your chequing to your savings account in the amount you are saving from the changes to which you’ve agreed.  Then decide how you’re going to spend the savings.  If you had that $1200.00 in your pocket, at this moment, what would you do with it?


By:  Brenda D.  Owens, Trustee in Bankruptcy


Brenda works for James R. Yanch, Trustee in Bankruptcy
215 Simcoe St. N.
Oshawa, Ontario
L1G 4T1
905-721-7506
www.jamesryanch.com