Reader Q&A: How to Track Your Spending

Reader Q&A

Every now and then, I get an email or Facebook comment from one of my readers that just makes my day! When there is a question that seems like it might be relevant to more than just one of you, I ask the person if she (or he) wouldn’t mind me sharing it. Yesterday I got one such note about tracking spending. Here’s the question and my answer, but I would love to get your input as well.

I’m loving reading your blog. I get so many good ideas. One thing I really have a hard time with is keeping track of what I spend. I make a budget, but then I end up blowing through the grocery category by the middle of the month. I’m wondering if you could tell me how you keep track of your spending, so that you know you are staying within your budget? Is there software or some other system that you recommend?

~ A Jewish, but not kosher, reader in Tucson, AZ

(This is how she asked to be identified , lest anyone think I’m making a statement with the above.)

Okay, so first of all, thank you so much for your kind comments. I’m not exaggerating when I say that they seriously made me smile all day! As for keeping a close eye on our spending, this is one of the keys to a successful budget, as we found out the hard way.

But let’s start with what DIDN’T work for us:

  • Using the debt card and keeping a running total in my head and/or forgetting to write it down/enter it into a budget tracking software DID NOT work
  • Using cash but forgetting to give some to my husband, so he used the credit card to buy stuff and then forgot to tell me DID NOT work
  • Using cash and withdrawing the whole month’s worth only to flitter it away on other things DID NOT work
  • Using cash and withdrawing a week’s worth at a time, only to forget to take out the portion for week #2 and then realizing when I’m at the check-out counter, so I have to put it on my credit card DID NOT work

As you can see, we became rather expert in what didn’t work! The challenge in finding something that did work is that I really wanted us to use cash because (a) it’s visual — when it’s gone, it’s gone; and (b) spending cash hurts – so I’m more likely to be tight-fisted with my shopping.

In practice, however, we’re so logistically challenged that we just couldn’t make the cash envelope work for us. Finally, a few months ago, I fell onto a system that blends all the advantages of cash for quick-and-easy tracking with the conveniences of a card to swipe for two-person shopping.

I signed us up for a Capital One 360 checking account. We already had our savings accounts there, so I just added the checking. This is in addition to our regular checking account, but we only use the Capital One 360 account for food & household items. Every month, I transfer the amount of money that we agree to spend on food and household items into that account.

Both my husband and I have debit cards attached to this account, which we use for all spending in that category.  I update the balance in the check register whenever I shop or my husband gives me his receipts — and I also check the account at least once or twice a week, in case somebody (not pointing any fingers here) has forgotten to give me a receipt. When we start running low in the account, I let my husband know that we only have $100 left in the account, so we really have to watch what we’re doing.

So far, it’s been three months and this system for tracking — and spending — our food budget really seems to be working for us.

Now all this assumes that you have a fairly good ball park estimate of what you’re spending each month and that that amount is reasonable for your income. If you are just beginning this process, then I suggest going super low tech and keeping a little notebook and pen in your pocketbook. Ask your husband to do the same in his pocket or wallet. Every time you spend anything, even $.75 for a coke in a vending machine, WRITE IT DOWN. Just force yourself to do this and by the end of the month you will have a much clearer picture of where your money is going. Then and only then can you make a budget and have a realistic chance of sticking to it.

So, now that you know our Capital One 360 secret, I’d love to hear how you keep track of your spending!


  1. We use a website called It is like virtual envelopes. The paycheck comes in and we know exactly where it will be spent. It talks to your bank so a transaction comes into mvelopes like the paycheck and we divide it up into the appropriate envelopes. As other transactions come in we drag them into the envelope and it subtracts from the total of the envelope. It is how we track everything from groceries, to gas, date night and the small amount we set aside each month for eating out as a family.

    • I remember you telling me about mvelopes a while ago, Anne. Glad to know it’s still working for you. I might have to check that out one of these days. (Did you catch my shout out to you in my month-long menu planning post?!)

  2. Very very good recommendation, awesome read, thanks

  3. Have you ever used

    It does a great job of categorizing your transactions and has features for budgeting, creating goals, and breaking down your spending history in many different ways.
    It is most useful for those that use credit cards for most of their purchases (and pay them off every month).
    I recommend it to all of my ‘clients’.
    (I work for a non profit where I provide financial counseling and other financial services).

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