Fashionista Finance: Keeping Track of Your Spending

For many, keeping a budget and saving money is high on the list of New Year’s Resolutions. It’s definitely on my list and I got an early start last month when I switched banks. Tired of being bullied with fees by a certain commercial bank I shall leave nameless, I went with a credit union. Many credit unions are non-profit organizations so they don’t charge as many fees as banks do. Any money they make goes towards higher rates on savings and lower rates on loans. Sweeet!

Whether you choose a credit union or a bank, one thing is for sure–you need to keep track of your finances! Something as innocent as forgetting about a $4.76 Starbucks run can cost you an additional $35 in a single overdraft fee (and don’t forget about 3 or 4 Starbucks runs–it’ll cost you upwards of $140) . To help you keep on track this year (and the next, and the next, and the next, and the—ok, you get it, right?) here’s a list of tricks to get your budget on.

1. Write it all down. When I opened my new account, the rep forgot to put my apartment number on my account so it took forever for me to get my debit card and therefore couldn’t sign on internet banking. I was forced to use my checkbook register—a thing I hadn’t used since the days of my first bank account back in 1999. Writing down all my transactions, every single one, helped me to always know my balance and also notice trends in my spending. Plus, seeing my balance get virtually smaller and smaller had me thinking twice about whipping out my debit card for unnecessary purchases.

2. Make a budget. You don’t have to be a finance major to create a basic budget, but it does take some discipline to stick to it. Whether you create an excel file complete with formulas or use the notes feature in your Blackberry, get a budget! Use it often so it becomes second nature like brushing your teeth.

3. Cheat on your bank. You may not want to keep all your eggs in one basket if easy access to your money leaves you penniless. Stash some of your cash in an account at a totally different bank makes it harder for you to raid your savings for an impulse purchase. If you have direct deposit, ask if you can have some of your money automatically divided amongst your different bank accounts.

4. Buy only what you absolutely love. If you can’t get at least 40 wears out of that pair of Hudson jeans you have your eyes on at Bloomingdale’s, don’t buy it. Often times we buy things out of impulse leaving us with closets filled with tons of one-off pieces that don’t really add value to our wardrobe. So if you don’t absolutely love it, leave it.

Those were pretty common sense, right? Now tell me—how do you keep track of your spending?