How I Track Our Money

02 Jan 2020 at 21:26 // under Money

In the deep distant past when I was fresh out of university and had just entered the workforce, I kept a very close eye on my spending. This was partly due to the fact that my reserve funds had all been depleted during my final summer before starting work and moving down into my new flat and also that because I was now dealing with all of my spending¹, the amounts of money I was dealing with had increased significantly.

2009 - 2012

Every month, I would review my credit card statements. I would transfer the total spend onto a spreadsheet, then extract items that were covered by some high level categories such as entertainment, dining out and travel. I would then store the totals of each category and leave the rest as 'other'. This was rather time consuming and didn't cover the categories in much detail. It certainly wasn't an ideal solution and after I stopped living on my own and life generally caught up, this method of tracking became unsuitable.

2012 - 2018

After we bought our house, I switched my tracking method. I was still using a spreadsheet, but instead of tracking the individual items and spending, I focused on the bigger picture. Each month I simply wrote down the current balance of every account (including credit cards, mortgage and student loans). I could then graph this snapshot and see how we were progressing. It was still quite labour intensive as I had to log into every company I had an account with, but was easier than the detailed spending method. Unfortunately I lost visibility of my spending.

2018 onwards

In 2018, with the open banking regulations, banks were required to allow customers to access their accounts through 3rd parties. Money Dashboard is one of these companies. They access all your accounts and present the information in one place. They analyse all the line items and automatically tag them for you. If you don't like the tags, you can change them. This has allowed me to keep an eye on both my overall progress and check on the detailed spending levels. It has also allowed me to keep an eye on unexpected spending such as when recurring payments reoccur after cancelling the subscription.

Money Dashboard is not perfect. It only covers current accounts, credit cards and savings accounts. It does not cover mortgages or investments. As a result, I still use the spreadsheet from between 2012 to 2018, but now it is much easier to fill in because most of the accounts are in one place.

One of my greater frustrations is that it can't match transfers between accounts even just paying off a credit card. It sees it as an expense (money leaving one account) and income (as the money arrives in another). Therefore their statistics for my annual income and expenditure are ridiculous due to the amount of money transferred between accounts.

When you sign up, some services only allow it to access relatively recent payments therefore I have limited data before October 2018. Now I have had the service for over a year, I can now get a more accurate picture of my annual spending.

The way the data is presented is OK, though there are lots of ways I would prefer to change or improve it. Luckily you can export all of the transactions, including the tags, into a CSV file, allowing you to analyse them in anyway you wish.

I am a big fan of this hybrid approach, using Money Dashboard to gather the raw data then producing my on analysis, some of which you might get to see if I ever get around to it. Even if you don't want to do your own data geekery, I still highly recommend using Money Dashboard.

1. While I was a student, my parents covered all my housing costs ↩

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