For your other journal...

So yesterday's post talked about keeping a diary of what things typically cost you so that you know when they are on sale, or when to take advantage of a sale. While you're out buying a journal for that purpose, grab another one for this entry too.

I strongly recommend using another journal (or notebook, find them on sale in school supplies this time of year) to record EVERY cent that goes in and out of your hands. I'm not kidding when I say EVERY cent of every item you buy, or any income you take in. I have been reading Your Money or Your Life, a popular read in personal finance, which makes this ultimate suggestion to begin with. At the end of the month (or throughout it, actually) I highlight items that are not necessities, and you will come to see where all that extra money you should have is going. This exercise makes you INCREDIBLY aware of what you are spending, and it may even seem like a chore to spend money knowing you have to write it down in a book (and possibly feel guilty about it later). The only things I do not itemize specifically are food purchases. Although this would likely also help me become more aware of overspending on food, I don't keep a bible-sized journal with me to write it all down. If you ever look at your bank statements and wonder where your money is going, this is a great habit to start since it is all there in your little book. And if you are good at updating it daily, it really isn't a chore, 5 minutes at the most. I have been keeping up since the beginning of the month and it has been helping me tremendously in managing spending habits.

I keep a column on one of the pages for "eating out", which also serves as a reminder for me the last time we went out to eat, therefore I am less likely to spend money on eating out realizing we just did a few days ago. It is a great self-monitoring tool, especially for those with busy lifestyles.

Again, I would also like to recommend reading Your Money or Your Life by Joe Dominguez and Vicki Robin, its been out forever, and you are likely to find it at your local used book store (as I did). They offer great tips and perspectives on how to change your outlook on money, and it is a great read for anyone looking to change their personal spending habits. Most blogs I have seen on saving money make it a top book on their list.

What does this cost?

Many of the tips I have been reading regarding saving money suggest keeping the infamous "price journal". I know when I started trying to save money, trips to the grocery store were different, mostly because I had no idea what was a "normal" price for a typical item. I had no idea what was expensive and what was a good deal. Especially when you come into trying to start saving money out of the blue and/or do not have a lot of experience cooking, this is good habit to keep up with. The premise of the idea is to basically keep a journal where you record what things cost that you buy on a consistent basis. Be sure to be very specific when recording these items, like the brand and size of the product. That way, when things go on sale at the grocery store, you will know a) how much you are saving, b) if the sale is worth taking up on, and c) how much to stock up on.

Keeping a journal like this will also likely make you more aware of what things cost in general. The experience of writing down what prices of things actually cost bring a bigger realization of where your money is going, and if it is really worth it. A journal is incredibly cheap to pick up, especially with school supply sales going on right now, it can be anything that fits your lifestyle, which is important to note since it should be traveling with you for grocery trips. Borders and other book stores typically sell cheap $2 journals as well, if you would like something more fancy, go for it.