20 Mar 2023 | Edukatips

Benefits of Tracking Expenses You Should Know

Some often think that tracking expenses is trivial and difficult to do consistently. In fact, its benefits are substantial. One being help you to be wiser in managing expenses. In addition, tracking your expenses is useful for assets and wealth. To learn the benefits of tracking your expenses, see the review below!

Benefits of Tracking Your Expenses

There are at least five benefits of recording expenses that can be obtained. Check out the full explanation below.

1. Know what expenses are used for

Why do you have to track your expenses? One of them is to know what expenses are used for. For example, whether the expenses are for monthly necessities, beauty treatments, or entertainment. 

Knowing where the money is spent allows one to better understand whether the allocation or budget is appropriate. If the allocation is inappropriate or face difficulties, adjustments can be made as soon as possible. So, you can spend your money more wisely.

2. Know the average daily, weekly, and monthly expenses

Keeping track of expenses is also useful in knowing the average amount of daily, weekly, and monthly expenses. So, if you spend more than normal, it will be easy to evaluate it. In the end, your money will be used for necessary items only and can even be allocated for saving or investment.

3. Identify necessary and unnecessary expenses

Journal of daily expenses is useful for identifying necessary and unnecessary expenses. For example, based on journal entry, it turns out that you have been shopping ineffectively as you spend it on unnecessary or useless items. Furthermore, a journal entry can also identify sudden needs that turn out to be a lot of money. In the end, this can help you decide to set aside an emergency fund and reduce unnecessary spending.

4. Makes financial planning easier

How do you keep track of your expenses? There are many steps. However, please note that the most important benefit of tracking your expenses it to make it easier to plan finances. Furthermore, making a habit of tracking expenses can help you getting used to budgeting. It means that when daily expenses are handled well, you won’t find it difficult to make long-term financial planning. With this, one can be more confident to achieve their long-term financial goals.

5. Know your transaction limit

By knowing the average expenses and what the money is used for, it can help set the daily transaction limit. One of them is setting the BCA Debit transaction limit through myBCA. You can set limit for cash withdrawals, transfer between accounts or interbank transfer, and set debit transactions more easily, so that your expenses are controlled. Check how to do it here.

After knowing the various benefits of tracking your benefits, it’s time to track them regularly.