How I control my expenses

Table of contents

Through the years, I created multiple systems to keep an eye on my money. In this article, I want to share how I control my expenses as well as some pills of financial advice.

Briefly explained, my system consists of:

  • 2 bank accounts: expenses and savings
  • An spreadsheet to keep track of monthly expenses and get a sense of my monthly cash-flow
  • Phone app to track casual expenses
  • Monthly retro

Expenses and savings accounts

Let’s start with the 2 bank accounts. The reasoning behind this is simple: separating my savings and expenses gives me more control over how much money I choose to spend.

Every month, I transfer my monthly budget from the “savings” account to the “expenses” one. Over the years, I found the magic amount that covers me almost any month. Some months I might exceed that budget, however, that’s fine as long as it happens rarely.

The key behind this system is that it requires very little self-control. My payroll is deposited to my savings account, a periodic transfer moves a portion of it to the expenses account, and finally I only make payments with my expenses card.

As simple as it sounds, this has helped me for more than 5 years. I consider this to be an essential for saving money.

Monthly cash-flow

Recurrent payments like memberships, housing bills or subscriptions, need a different approach. Most of those expenses are paid monthly. In order to track them I use a simple spreadsheet like the following:

Concept Type Amount
Salary Active 1000€
Spotify Passive -10€
Gym membership Passive -50€
Rent Passive -400€
Cash flow   540€

I marked as “active” all the things that bring money into my life, and “passives” are the contrary. Building this table provides me an outlook of my recurrent expenses. Furthermore, it helps me keep my monthly expenses to a minimum.

The most important number in the table is the sum of all the amounts. This total represents my “monthly cash-flow”, in plain words, how much “free” money I have after paying non-negotiable expenses. I think of this amount as my “real income”. Knowing that number is useful for calculating your “monthly budget” (see previous section).

Casual expenses

Keeping track of all my expenses was tedious at first, however, after a couple of months I noticed the value of it.

Everything started with a guess of how much money I spent monthly. I saved that number and tracked every expense for a couple of months to see how accurate I was.

The tool I used was an iOS app called Dime. I liked the simplicity, and it allowed me to categorize my expenses. Furthermore, it has a lock-screen widget which has been extremely useful to quickly save expenses.

A few months passed, and I was surprised to see how off my guess was. In reality, I was spending ~30% more than what I guessed. In my case I was eating out too many times.

Despite being tedious having that information has been key for preventing a habit of over-expending.

Monthly retrospective

Collecting data is only useful if you’re going to use it for something meaningful. In my case, I review the data in Dime on a monthly basis to keep myself on the right track.

Inside Dime, each expense has a category associated, one of the following:

  • Food (eating out + delivery food)
  • Groceries
  • Utilities
  • Fashion
  • Go out (partying and whims)
  • Transport
  • Gifts (to myself and others)
  • Healthcare

The retro consists of reviewing the sum of expenses for each category and asking myself if I’m comfortable with it or not. When I’m not comfortable I check the details to identify the root cause.

Remember, not all months are going to be equal, don’t stress about it. For example: in Christmas and summer we usually spend more money.

Financial advice

Before finishing the article I want to give some financial advice that I find helpful.

  • Keep your system simple, don’t obsess over money. Try to find a process that works for you and provides a balance between control and ease of use.
  • Remember that money is meant to be spent. For some people (I can relate) it’s hard to spend money. I have a simple rule: if something improves my quality of life its worth my money.
  • Spend more on things you value and cut down on things you don’t. Personal example: I stopped going to fast-food places and reserved that money for more expensive meals that I enjoy more. Identify the items and services you enjoy the most and allocate more money to them.


Money management doesn’t need to be complex. In this article I tried to explain my system so that anyone could understand it. I’d like to hear how others manage their money.

Help a friend by sharing this post and helping more people take control of their money.

Thanks for reading.

Contact me