Tracking expenses for entertainment is one of the hardest things to do. The reason it’s so hard for most of us to get our heads around expenses is because we’re too busy having fun and not monitoring our monthly budget. Here are five simple ways to get on top of your entertainment expenses before they derail your savings account.
1. Pay for Entertainment on a Credit Card
Image via Flickr by 401(K) 2013.
Having a single credit card dedicated to entertainment is one of the easiest ways to keep track of what you’re spending. If you use that credit card for other things, like gas or groceries, it might not be easy to separate the items when the statement comes in.
Dedicate one card to entertainment only, and use it for all your entertainment: going to the theater, renting movies, seeing a concert, visiting the zoo, attending an amusement park or anything else entertainment related. At the end of each month, you’ll have a tidy, uncluttered list of all these charges.
2. Download an Expense Tracking App
If your smartphone doubles as your right hand, perhaps an app is the easiest way for you to track different types of expenses, including entertainment. Apps like Mint.com, Xpenser, Pennies and Cashish let you categorize spending so you can see how much you’re spending on food, fuel, entertainment and bills. These apps are also available on multiple devices, for those rare times when your phone might not be in an arm’s distance. And considering the amount of security that is programmed into our phones, it might not be a bad idea to do handle your banking on your iPhone over your PC.
3. Create an Entertainment Spending Spreadsheet
Excel and other spreadsheet software allow you to create a ledger to use for keeping up with all types of expenses. Regularly entering your transactions into the ledger lets you keep up with your spending on different categories, such as power bills, eating out, babysitting costs and entertainment expenses.
Spreadsheets can be used exactly like a paper transaction register, but if you program it to keep your running total it will always keep you informed on your current checking account balance and let you easily identify entertainment costs. Spreadsheets are ideal companions to online banking because you can keep your transaction register updated as entries come into your account and show up on your online banking transactions list.
4. Withdraw Cash for Entertainment and Don’t Go Over Budget
If you’re on a tight entertainment budget, a great way to limit your spending is to withdraw the amount of money you can afford to spend each week and limit yourself to that cash. Keep it separate from your general cash, such as in an envelope or paper clip. Only use your entertainment money for these outings, and never allow yourself to dip into your cash for gas and food for movies and other fun things. For example, calculate how much you spend between checks on gas, food, bills, savings and unexpected expenses. Keep that amount in your bank account and the rest you play with. As long as you are continuing to save each month and plan ahead, you should not have a problem when the unexpected occurs.
5. Use an Old Fashioned Pen and Paper
For some of us, technology is just too much. You can easily keep a small notebook in your pocket or purse and jot down what you spend on entertainment as it happens. The key to making this strategy work is getting in the habit of having the notebook with you whenever you go out. Many people have success with the old-fashioned way when the high-tech stuff is intimidating or frustrating.
Of course, the success or failure of any finance management strategy depends on the person and the protection of one’s assets. If further protection is needed, it would be advisable to look into security systems for ultimate control over what you have worked hard for. It’s great to enjoy life, but in order for the fun to continue, everything has to be done with some sense of moderation.