How to… keep household accounts.

Keeping accounts is a pretty useful thing. Whether you own a small business, are saving up for something or keeping a home, having a record of your incomes and outgoings can be useful, insightful and even life saving.

It is also boring, gets complicated and can seem very time consuming. Otherwise, everybody would be doing it.

The great thing is: everybody can do it. You just need to follow these tricks to make your accounts something simple and easy.

1: Create a table of outgoings. The fixed costs.

Usually your incomes will be fairly fixed and, even if they aren’t, outgoings are the more important one to track. You can easily guess at what your income is, but outgoings are mysterious numbers on your bank statement at the end of the month.

Your table will be divided into two. The first half will be fixed costs on a monthly basis. These are everything that goes out on the regular, like phone contracts, insurance, unmetered bills, etc.

2: Yearly costs in your fixed cost table.

When it comes to yearly costs, make a separate bank account to save for them. Divide the total cost by 12 and make a payment of exactly that much every month. Then, add that payment to your fixed cost table as a monthly payment.

3: Random costs table.

Random costs are the ones that move around a lot, like fuel, food, pets or metered bills.

Your random costs table will not be like your fixed costs table. It should cover every day of the month, from the 1st to the 31st, including weekends. It should have a column for bills, one for groceries, one for car, one for services and one for unexpected bills.

4: Payment method column.

Your payment methods also need to be kept track of. Make a column for every payment method you use. Every single account, credit card or online money trader. Also keep a column for coupons, discounts, points and other forms of payment.

In the end, your tables will look a little like this:

Month.

House.

Water bill.

Home insurance.

Pension.

Account 1.

Account 2.

Jan.

400

10

8

150

-568

0

Feb.

400

10

8

150

-400

-168

Etc…

APRIL

Day.

Groc.

Elec.

Serv.

Fuel.

Unex.

Ac1

Ac2

PP

Cred.

ISA.

Coup.

1

0

67

0

15

0

77

5

0

0

0

2

Food.

25

0

0

0

0

0

20

0

0

0

5

3

Pet.

12

0

Hair. 10

15

0

5

0

12

0

0

5

Etc…

Total.

-77

-67

-10

-30

0

-82

-25

-12

0

0

+10

And at the end of every month you have a total outgoing in assorted expenses. The coupons and the likes are counted as a plus simply because that’s money you didn’t spend, so you got a 10 haircut, but got 5 back, if that makes sense.

Try and use a calculator page so that you can add up every column for it’s total, as well as at the end of the month add up all your expenses into one bar at the bottom! Otherwise, be sure to add up your random expenses daily, so you don’t have to sit around crunching numbers for hours at the end of the month.

6: Using it.

At the end of every day, go through your receipts and add the expenses to the calculator. Add the money out twice: once to the column it belongs to (Food), once to the payment method used (Credit Card). If you haven’t got it on a calculator page, be sure to add it to the total. Do not add the coupons at all yet!

At the end of the month, add together the fixed expenses and that month’s total. Take away the month’s total saved in coupons. That is your monthly outgoings.

7: Income.

If your income is fixed, just take note of it and take your outgoings away from it to see how you’re doing. You’re done!

If your income is not fixed, we move onto step 8.

8: Random income table.

This table is very similar in the way it works to the random outgoings table. Take every day you work. I will use two examples, one for my income and one for Jon’s. You want one column to be your working days. The other will be your earnings. You want to do a column a week for each category.

So, seeing as I work five or six days a week for random earnings, I fill mine in like this.

Week 1

Week 2

Week 3

Week 4

Week 5

Week 1 +

Week 2 =

??????? +

Week 3 =

??????? +

Week 4 =

??????? +

Week 5 =

MONTH

F1

M4

M11

M18

M25

S2

T5 N/A

T12 N/A

T19 N/A

T26 N/A

W6

W13

W20 N/A

W27

T7

T14

T21

T28

F8

F15

F22

F29

S9

S16 N/A

S23

S30

Total.

Total.

Total.

Total.

Total.

And seeing as Jon works 3 or 4 days on, 3 or 4 days off, sometimes days, sometimes nights, his looks like this.

Week 1

Week 2

Week 3

Week 4

Week 5

Week 1 +

Week 2 =

??????? +

Week 3 =

??????? +

Week 4 =

??????? +

Week 5 =

MONTH

4 D

11 OFF

18 N

25 D

5 N

12 D

19 OFF

26 N

6 N

13 D

20 OFF

27 N

7 N

14 D

21 OFF

28 N

1 D

8 OFF

15 N

22 D

29 OFF

2 D

9 OFF

16 N

23 D

30 OFF

3 D

10 OFF

17 N

24 D

31 OFF

Total:

Add your salary to the table every day and then total it at the end of the week. Add week 1 to week 2 and the total to week 3 until you reach the end of the month. That is your income.

And that is how you do your household accounts the easy way. At the end of the month, be sure to make a note of how much is in each money source to make sure you aren’t overspending and that no accounts are getting too empty!

And please share your accounting tips in the comments, I’d love to hear them! 🙂

TTFN and Happy Hunting.

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