Staying on Track

Lor Cleveland, Licensed Insolvency TrusteeInsolvency

My husband retired a short while ago. With less household income and more time on his hands, we wanted to make sure we didn’t keep living the same lifestyle we were accustomed to when he was working fulltime.

I tracked our monthly income and expenses for an eight-month period. I recorded all money coming in from whatever source. And I recorded all our expenses, to the penny. The difference between the totals showed our monthly surplus.

I could have just looked at our bank statements because most of our spending is by debit. But I also wanted to be able to see where the cash was being spent. A bank statement lists transactions as they happen, day by day. My tracking totalled the expenses by category – food, gas, meals out, etc.

It was relieving to see that there were no real surprises. But I did see that our food expense was a little higher than before. Nothing wrong with that, as long as it doesn’t put us into a deficit.

People who file bankruptcy or a consumer proposal are required to do monthly cash flow reporting. The majority of them discover to their great satisfaction and relief that by paying attention and being intentional with their spending, they actually have enough to live on and don’t need credit. Powerful knowledge indeed.