Give Yourself a Raise in 30 Days

Here's a tip (point #2 in the piece) on how to give yourself a raise in 30 days:

Do a thirty-day spending journal where you list literally every dime you spend—on everything you buy. Then, at the end of those thirty days take a yellow highlighter and mark everything you bought that you didn’t have to buy. That’s how much of a raise you can give yourself starting the next month. You may be stunned at how much is being wasted.

I've done this before (a long time ago when I really needed it) and it was very enlightening. There's so much money that seems to leak out in small bits here and there -- and it can really add up.

I've also recommended this process to many people throughout the years. My wife and I used to counsel people who were usually in tons of debt. We tried to work out budgets for them and the math often wouldn't add up. Then we'd have them track their spending -- every penny -- for 30 days and boy would that be an eye opener! Suddenly, we could find tons of things to cut back on to help them balance their budget.

Anyone else ever tried this? What were your results?

Comments

[pink panther]

This works and I recommend it. Get a little notebook and write down what you spend. I started doing this and found many places to save money. After a few weeks, it'll just be another habit. (Keeping records saves money - I keep a list of credit card charges and check against my statement and find ... interesting things.)

Also, expand spending from a daily/weekly scale to monthly/yearly - that $5 NY Times each week looks cheap until you see it's $260/year.

One distressing thing for me is how many unrecurring, essential things keep coming up. I need this, and that, and the other -- adds up, but each one is maybe a purchase once in 5 years. Hard to contain things like that.

[Mama Sweet]

I'm doing this right now. I want to see just where my money is going and how I can keep more of it. And actually, it's already working - i think, do I really want to have to write that I spent $4 on coffee? I'll be so mad when I read that next month. So I drove past this morning.
Things that I am sure are going to bother me are dry cleaning and lunch meetings at chi-chi places that I can't get reimbursed for.
Where can i find quick, simple, cheap dinners to make at home? (Food network.com,etc.?)

[D.R.]

I've done this many times to keep myself in line. I've also recommended it many times to friends, when I'm helping them with their finances. One knew she spent a lot on shopping and eating out, but she was shocked at the end of just two weeks when she saw the totals in just those two categories. (What she had estimated for the month on each thing, she had already spent and then some.) Even when your income is low, this can help you remember to add categories to your budget you forgot. The bills that don't happen weekly or monthly, for example auto tags/plates, any gifts, or even some insurance.

Isn't there a lot of gray area in determining what one did/did not have to buy?

If someone at the supermarket puts a steak or a bag of potato chips in their cart, it could be argued they didn't have to buy that. (They could have bought ground beef or chicken and could have entirely done without the chips.)

Even Kraft mac-and-cheese could be argued unnecessary - I buy generic mac-and-cheese.

[Janet]

I've tried it a couple of times and it really works. There's an added bonus, just because I'm keeping a record of every cent I will end up with less impulse items (That chocolate bar at the checkout that I just can't resist!)