How Expense Tracking Works
Expense tracking is something spoken about quite a bit in the personal finance space. What is it and why is it important?

How expense tracking works, person holding phone and using calculator app to add expenses.
Source: Kelly Sikkema via Unsplash

What is expense tracking?

Expense tracking is tracking the money you spend. It involves mindfully keeping tabs on what you spend money on.

What role does expense tracking play in one's finances?

Tracking your spending plays an important role in knowing where your money is going. It can help you stick to your budget and keep your expenses low, so you can have more control of your finances. 

The importance of expense tracking

How expense tracking works, Robert E Blackmon gif of man stressed out typing expense report
Via Robert E Blackmon on GIPHY

As stated above, tracking your expenses plays an important role in your finances. It can help you figure out where you're spending your money and where you need to cut back on to lower your expenses. 

How to track your expenses

How expense tracking works is that you record all your expenses and calculate the total thereof. This can be done perpetually (after each and every expense, e.g. taking note of what you spent at the grocery store one afternoon using the notes app on your phone), or periodically (at the end of the week, month, etc).  

This can be done in several ways:
- Using the notes app on your phone to track your expenses
- Writing down your expenses on a notepad (pen & paper method)
- Making use of a spreadsheet like Excel, Google Sheets, or Numbers by Apple
- Using an online budgeting and finance app 

Benefits of expense tracking

Benefits of tracking your spending include:
- Spending less
- Tracking your expenses
- Identifying areas for improvement 
- Spending money mindfully 
- Controlling credit card spending 

Spending less

Tracking your spending can help you spend less because when you keep track of what you're spending money on it is a lot easier to identify what you need to cut back on.

Tracking your expenses

By tracking your expenses, you are able to identify what you are spending money on and how much it is you are spending on that item or service. This can be useful when evaluating if you have adhered to your budget

Identifying areas for improvement

Keeping track of your expenses might help you uncover areas where you can save money. This is when you realize you have overspent on a certain expense line item (monthly subscriptions, for example) and wish to cut back to a more manageable level of spending (e.g. instead of monthly subscriptions being R500pm, cut them down to R250pm). You can decide what is an acceptable amount for you to spend in each category of expenses.

Spending money mindfully

When you track your spending, you are more aware of where your money is going and how much of it you are spending. This can be helpful when you set a financial goal to spend less and stick to a budget.

Controlling credit card spending

You are more likely to know what your upcoming expenses are if you keep track of your spending. This might assist you in anticipating potential expenses so that you are not caught off guard and forced to use your credit card.

Via Fetish Series on GIPHY

Tracking your expenses can help you figure out what you're spending your money on, how much you're spending, and how to reach set financial goals.


Thank you for taking the time to read this blog post. I hope you enjoyed reading it as much as I did writing it.

Expense tracking is important because it helps us to be mindful of our spending habits and can assist us in getting control of our finances. Hopefully this blog post helped you learn the importance of expense tracking and how expense tracking works. What do you think about expense tracking and what is your favourite way to track your spending? Share your thoughts in the comments section below.

Till next time!

Take care,


This blog post is for informational purposes only and does not constitute financial advice. 

The information presented herein is not a substitute for and should never be relied upon for professional financial advice.

Always talk to your financial advisor about the risks and benefits of any financial information shared. If you are looking for financial advice, kindly speak to somebody who is certified and registered with the Financial Sector Conduct Authority (FSCA).

eishstudentbudget™ and its owner(s) are not liable for any loss, harm, or damage you may incur as a result of you using the information presented here.

1 comment:

  1. Tracking spending is a good idea. I have to cancel one thing in order to save up for another.


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