Shortly after we moved from the dating phase to the serious relationship stage of life, my then-girlfriend – now-wife – showed me a multifaceted spreadsheet she’d created to track expenses, a monthly budget to follow, and even a page to estimate our savings for vacations and the down payment on the house we’d eventually buy together. At the time, I teased her that she’d forgotten to plan for our funeral expenses but, in retrospect, I owe much of the lifestyle luxuries that I enjoy today – a car that works, a solid roof over our heads, and so on – to the fact that she was a forward-thinking planner. Now even if you’re not lucky enough to find someone like her to marry, there are a number of tools out there that can help you to create a budget and better manage your expenses.

Tracking expenses

Any financial planner – or credit counsellor – will tell you that the first step to creating a budget that you’ll stick to is tracking your ongoing expenses for two or three months. And by “tracking your ongoing expenses,” I mean keeping track of every single thing you spend money on during that period. Start with the big-ticket items – rent or mortgage payments, insurance, utility bills, et cetera – add-in the recurring mid-range expenses such as groceries, gym memberships, and the like, but also keep track of seemingly little things like fast-food lunches, takeout coffees, magazines, and other impulse buys. You may be surprised by how much all those $3 lattes add up to in a month.

With hard numbers in hand, you can group them into appropriate categories (housing costs, entertainment, meals, et cetera) and start to assess areas where you may be able to realistically pare back and start building your nest egg. But if you’re not savvy enough to build your own tracking tools, check out the online options, many of which are free.

Free tools

RBC has some simple savings and budgeting tools grouped on their website under the Savings Spot banner. The Spend-o-meter, for example, is a great graphic tool that quickly shows roughly how much you spend in a week, month, and year based on the number of everyday items like coffee, takeout lunches, and movie tickets you buy each week, along with some money-saving tips (like subscribing to your favourite magazines instead of paying the full news stand price each month).

And there are a number of more comprehensive, free online budget tools out there as well. Mint.com/canada, for example, will pull information directly from your online banking and credit card accounts and sorts it into appropriate categories automatically. (They stress that their system is “protected with bank-level security.”) The U.S.-based site launched in 2007, and has since added all the major Canadian banks and commercial credit cards to their lineup. You can view your progress online, or via their free apps for iPhone and Android devices.

Save your savings

If you’re an impulsive person, it may be hard to look at a growing bank balance and not be tempted to spend some of it. So, following the out-of-sight, out-of-mind principle, you may be better off setting up a separate account for your savings. If you’re saving for something like a trip where you’ll need to have relatively quick and easy access to the funds, consider opening a no-fee bank account where you’ll earn a modest amount of interest while your money slowly grows. If you’re planning on saving for something more long-term, like a home or car purchase, you may be better off with a secure, higher-interest bearing investment product like bonds or GICs.

Allan Britnell

Toronto-based freelancer Allan Britnell is an award-winning writer with nearly 20 years’ experience. He covers a diverse range of topics, including DIY and professional home renovation projects, nature and the environment, small business, personal finance, and family and health issues. He is also the managing editor of Renovation Contractor, the publication written for small- and medium-sized contracting and custom home building companies. He lives in Toronto with his wife, two daughters, and their dog, Oscar.

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