I was reading a blog today and a topic of discussion was how to measure your savings? Is it tangible or intangible? This really varies from person to person. There are ways to measure and track your savings, just choose what works for you.
First and foremost, to track your savings, you must have a budget. There is no way getting around this one. You need to know what you are spending on your weekly grocery trips and budget for that.
So, how do you know what to budget for groceries? An easy way to do this is to look back at your last 8 weeks’, or 2 months’, worth of grocery receipts. Calculate the average of what you are spending per week. That gives you your budget. Here’s a simple calculation:
Week 1: $93.04
Week 2: $87.68
Week 3: $110.45
Week 4: $105.72
Week 5: $98.92
Week 6: $82.04
Week 7: $115.20
Week 8: $107.49
TOTAL: $800.54
Divide that by 8 and your average weekly grocery run is $106.07 (I’d round this down to $106 per week).
Once you have your budget, the easiest way to keep track of your savings is to use cash. Just get the cash you need for your pay period grocery trips and put into an envelope marked cash. Then, as you pay for your groceries, you will be able to hold your savings at the end of your pay period in your hand. (And, you’ll find that using cash, you really spend less because it is harder to part with it.)
Well, what if cash isn’t for you? Use your debit card or write that check as usual. When you get home, just transfer your savings into a separate account. You will probably be surprised that you don’t miss it. When you are use to paying $106 per week and then start to pay only $75 – that is $31 every week into savings or $104 in just one month! So, your monthly outflow doesn’t change, however, you are starting to build up a savings account.
Other options for tracking savings are to keep a list in excel or journal, give the savings you see directly to charity, or even use your savings towards funding college. The list really is endless as to what will work for you to track your savings.
Just find what works for you to measure those savings in a way that keeps you motivated to save money.