Spending Scorecard

This is a great alternative or addition to traditional budgeting.

Where Your Money Goes

• Forget guilt fueled budgeting and try something new. This is a slower and more thoughtful way to understand and change your spending. Start with the month that just ended, when all your bank statements are already available. Go through every expense and record it in the printable worksheet or in a simple spreadsheet. Track everything, including any credit or debit card purchases and anything you remember paying for with cash.

• For each transaction, write down the date, dollar amount, and a short description. Then give each transaction a 1–5-star want-to-need rating. This helps you understand how necessary each expense was. For example, housing is almost always a five-star need, but if you live alone in a large apartment and money feels tight, maybe it is more like a three. It is still housing, but maybe more than you truly need. Gas to get to work is a five-star need, but gas for a long joyride to a casino is more like a one-star want. Groceries like rice, beans, vegetables, and other healthy staples are a five-star need, but fast food and restaurants fall more toward the want side of the scale.

• Then, the joy scale, how much satisfaction each purchase gave you on a scale of 1-5 stars. Something like buying books might be a one-star need but a five-star joy rating if it truly brings joy to your life. Going out for drinks might be a one-star need and a one-star joy rating if you do not really enjoy it and regret it later. For someone else, drinks with friends could be really enjoyable, so maybe a one-star need but a five-star joy rating. You are the judge of what is needed and what is not. You decide what you enjoyed and what you did not. There is no external judgment, blame, or shame. The worksheet simply encourages you to be honest with yourself. Use the notes column to add reminders like “worth it every time,” “never again,” or “would have been cheaper and more fun sober,” or any thoughts that help clarify your view on your spending habits.

• After you complete this for the first month, look it over and think about what spending you are happy with and what you want to change. Then do the same process for the next two months as each one finishes and the statements become available. After three months, compare your third month to your first. Look at how your total spending and average ratings start to shift. You will probably notice that your spending choices start to naturally change over time. This is the change that happens when you start understanding what you really value.