Expense Manager takes control of your expenses step by step

Expense Manager takes control of your expenses step by step

I believe that managing our money efficiently and covering everything we have to pay for, everything we want or have to buy and everything we would like to do, is a challenge that constantly accompanies us.

For almost no one it is a mystery that one of the simplest formulas for financial success consists of making intelligent use of your income, so that each month you manage to cover your needs, and also have a surplus with which you can invest, or save for some goal.

Expense Manager

Pie diagram by categories

If you are one of those who wants to control your expenses and keep a statistic of where most of your money is going each month, there are many alternatives, such as keeping your own spreadsheet where you record all your expenses, or a notebook of notes, or an application to help you with this task. Today I would like to talk about Expense Manager, an App for Android that I started using almost a year ago, in order to have a clearer understanding of the amount of money I spend on the main items of the house. It is important to clarify that there are many Apps of this type on Android and also on iOS, so the principles that I am going to mention below, despite being specific to Expense Manager, apply equally to any type of App of this type, since the philosophy it will be the same. So without further ado, we are going to see what steps you should follow to make good control of your expenses, through an App like Expense Manager.

With Expense Manager, the job of keeping track of your personal finances becomes very easy. Basically the application focuses on generating a series of reports of your expenses according to what you are registering. Therefore, to begin, the first thing to define is the categories in which you want to keep track of your cats, for example you could create categories such as the following:

  • Public services
  • Market
  • Entertainment
  • Loans – Credits – Cards
  • Health
  • Transport
  • Rent
  • Others <- be careful with this

Expense Manager categories

The categories that are created are seen when registering an expense

It is important that you create as many categories as you consider, without going to the extreme of creating many because it will be difficult for you later to understand where your money is going having so many categories. On the other hand, it is equally counterproductive to create very few categories, because the real objective of the App would be hidden, which is to see which category is the one that occupies the most part of your budget. One recommendation of mine is that even though sometimes it is useful to create a category called “others”Where you will record all the expenses that do not fit in any of the above, make little use of itIn the end, this category tends to hide the possible suspicious expenses that take your money or mix unrelated expenses that will not give you any information or trends. I would say that if at the end of a month, the category “other” is the one that takes most of your income, it is because you are definitely misclassifying the expenses that you register in the application.

After you are satisfied with the categories you have created (keep in mind that they are not fixed, that is, you can change them whenever you need it later), the next thing you should do with Expense Manager is to set a monthly budget for each one of them, that is, how much do you expect to spend per month in each of these items, or at least in the most significant ones.

Although this step is optional, for me it is crucial, and although it may happen that at first you are not very clear about the values ​​that you should put as a budget in each category, it is important that you consider them at least as an initial challenge. Then over time you can improve these budgets, as you see whether or not you are able to meet them.

Expense Manager categories

Budget by categories vs expenses

The advantage of setting a good budget (which is realistic of course) is that the application will be comparing you at all times, how your expenses are going for each category with respect to your budget. In my opinion, this is one of the most useful points that Expense manager has, since If during the month you see that you are about to spend in your budget, for example to “entertainment” or to “Transportation”Then you are going to control or moderate your expenses in these categories, which otherwise you would not have present.

Alternatively, Expense Manager allows you to build a frequent income plan. That is, if you are an employee and your salary arrives every month divided into 2 fortnights always the same day of the month or you are paid a lease on a specific date each month, then you can leave this income programmed in the App so that you do not have it to register. The control of income in Expense manager is optional, since its objective is to control expenses. However, if you register your income, the application will make a monthly comparison between the money you earn and the money you spend, which is also very useful to understand if you are leaving a balance each month, or are spending more than what you earn in a few months.