How to track savings each month

There’s a sense of accomplishment and security from seeing one's savings gradually tick up, especially if targets are being met.

Why track savings and spending?

Tracking savings and spending can make all the difference in feeling secure about personal finances and covering important wants and needs. But first, individuals and families need to find a budget tracking method that works for them.

To help figure that out, it's important to understand the potential benefits of tracking savings and spending. This may include:

• Optimized savings: By tracking spending, it may become easier to spot areas where money is being spent unnecessarily within a personal budget. Cutting back on unnecessary expenses increases the potential to save more. For example, identifying and reducing frequent small purchases, like daily coffee runs, may boost savings over time.
• Sticking to a budget: Monitoring expenses is crucial to staying within a budget limit, preventing overspending, and promoting responsible spending habits. It may be particularly useful by helping people maintain discipline with discretionary spending and avoiding impulse buys by being on top of whether a potential purchase may fall into their budget or not.
• Achieving financial goals: Keeping track of savings progress may help to reach specific financial goals – whether that be saving for a vacation, retirement, or an emergency fund. Staying on top of savings amounts may encourage people to increase saving, spend less, or feel a sense of pride in meeting a goal.
• Sinking funds: Sinking funds are savings set aside for specific future expenses, such as a new car, home repairs, or a special event. By allocating money into separate sinking funds, it may be easier to manage and prepare for these costs without disrupting an overall budget.

Methods to track monthly savings

Tracking monthly savings and spending can be tailored to fit various preferences when it comes to money management. Here are some methods to consider:

• Budgeting apps and tools: Budgeting apps offer convenience and a range of features to help track expenses and savings. Many money saving apps can integrate directly with bank accounts, automatically categorizing transactions, and provide real-time insights. These apps often include visual dashboards, alerts for overspending, and goal-setting features.
• A monthly savings tracker: This tool can help keep tabs on how much money is saved each month. It allows people to break down their expenditures into clear categories and identify patterns of spending that can be changed or optimized.
• Spreadsheet budgeting: Using spreadsheets to track expenses allows for a highly customizable budgeting experience. Spreadsheets can be tailored to individual needs, providing a clear and detailed overview of income, expenses, and savings goals.

Templates are available online to get started or a personalized sheet can be created to suit specific financial tracking requirements.