July 23, 2025
How To Track Your Expenses In The UK?
By : Ellie Brown
Do you feel keeping a tab on how much you spend monthly in the UK is not necessary? This means that you are like the ones who do not want to limit their expenses. They feel that they are earning well and thus, they should spend well.
Regardless of what you perceive about spending, monitoring expenses does not always intend to restrict your spending. It is about assessing the likelihood of creating different opportunities, like saving for an emergency fund, etc.
Besides, if you are concerned about your financial wellbeing, tracking your outgoings is crucial. This will help you spot the areas where some immediate modification can be done. When you do not keep a check on expenses, you tend to spend money on things that are not needed.
At times, you want to have money for an important payout. However, you could not achieve it because your ongoing expenses have swept up your salary. Then, you want to acknowledge the reasons for not being able to keep aside money.
For that, you should start keeping track of money you have been spending. This will help you realise where you are overspending and which payouts should be discontinued. This way, you can free up cash that can be used for other purposes.
Ways you can pursue to monitor expenses in the UK
When maintaining the wellbeing of your finances is your greatest concern, tracking expenses is going to be a good exercise. In fact, this is one of the vital habits you must build when you are getting started with your financial journey.
At times, expenses need to be articulated so that you can walk towards achieving your goal. Tracking does not always mean to encourage you to cut expenses. There might be times when you need to allocate funds for the right purposes.
Besides, you might have to rectify your spending behaviour. For this reason, you must get an idea about the ways you are spending money. It will help you point out the irregularity.
There are other reasons as well to understand why you must pay attention to this step.
- You will be able to get acquainted with your spending pattern
- You must understand your expenses to be able to curate a perfect budget plan
- Achieve complete control over your spending behaviour
- Helps planning ways to control and slash your debt problems
- Unblock money that can be put towards achieving financial objectives
- Allows you to make better and more refined choices for the betterment of your finances
- Paves the way for you to become a better and more disciplined in managing finances
The different steps that will make this tracking of expenses achievable for you are given below.
§ Assess the goals you want to achieve
Are you wondering why this step should be done first? This is because you will need some motivation to begin the process. Otherwise, tracking expenses will be a half-hearted attempt.
Like everyone, you must want something to achieve with your money. Maybe you want to plan a better life for yourself in the upcoming days. Now, the main roadblock might be finances, as you will need additional funds to go ahead.
Find out the reason to try this step. It can be obtained by getting clarity on your financial objectives.
§ Select the tracking method
If you are thinking of using the old technique, i.e., the manual process, you are depriving yourself of some gems. This method of tracking has been made super convenient these days. There are tools you can use for this purpose and even to make a budget.
There is no need for you to get confused with complicated ways. You can try out the very basic way, like using spreadsheets from Excel. You can even consider using Google Sheets, as they both will serve the same purpose for you.
Segregating expenses is easy with the help of spreadsheets. You can have a complete view of where your money is going. This means you can control your financial situation by doing or undoing a few things.
You can even have an app installed on your mobile phone. This way, keeping a tab of where you spend money and whether you are overspending or not will be possible. You do not have to log into your laptop to get all the information.
§ Break down your expenses
The process should start with calculating the total amount you spend every month. Now, you must break down the total amount into amounts spent on different categories. This indicates that you must categorise your payouts to know how much money is needed in each category.
Then, you can clearly figure out the areas where the maximum amount of money is being spent. If you want, you can adjust the amount without discarding the payout straightaway. You might think that doing this once would be enough.
However, you must know that expenses will vary with time. For this reason, you must go through every category regularly. This will let you see how much money is still going into it.
One of the biggest reasons for monitoring expenses is that you will realise how you are spending without any plans. Moreover, keeping a tab on expenses is the first step towards the aim of changing your impulse spending nature.
§ Review and be alert
You should not miss out reviewing your bank statements. This is the place where you can find everything about the ways you have been spending money.
There is no need for you to grab a physical copy as you can check the e-statements as well. When you know the different avenues you must spend money on, you can be alert.
The bottom line
There are situations when tracking expenses is crucial, and you must not skip. If you are taking out a personal loan, you must know that you will have to repay it as well. Whether or not you can pay back on time will depend on how you manage your ongoing payouts.
To get clarity on this, you must go through your usual outgoings. This will ensure that some modifications can be made in your monthly spending plan. Then only, you should decide whether or not to opt for loans.
FAQs
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What do you mean by 50/30/20 spending rule?
This represents the amount of money in percentage that you should put towards the different spending categories. Therefore, 50% of the money you have should be utilised for your necessities, 30% for your desires and 20% should be kept as savings. The last category will accommodate money to sponsor your financial goals as well.
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How much money you should save for emergencies?
This saving arrangement is meant to cover expenses when you are in an unprecedented situation like sudden job loss. Your income might drop or even become zero if you are going through some health problems. Thus, when you are earning steadily, you must keep aside three to six months of living expenses as savings to navigate these situations.
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Should you save money for personal desires?
It would be great if you could save money for any upcoming expenses. Now, waiting till enough money is saved for personal desires might feel like depriving yourself. Ideally, there should be an equilibrium, i.e., you should save money and treat yourself by addressing those desires.