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.

How To… declutter paper.

We’ve already looked at speedy and efficient decluttering and how to declutter your wardrobe. Next we’re looking at one of our worst clutter areas: paper. Maybe you’re a student and going through last year’s work. Or you’ve accumulated a pile of bills and don’t know what to do with them. Or you’ve been away for a while and the mail pile has just piled up and up.

Well, as a private tutor I accumulate a lot of random paperwork and need to regularly go through it. Here is the fastest and most efficient way I have found of sorting paper.

1: Pile it all together.

If it’s a complete mess, just go round the house and empty all your piles of paper together. Most people have at least three, so here are the common piles of unsorted paper.

-Homework.

-Work sheets.

-Mail.

-Coupons and vouchers.

-Magazines and newspapers.

-Past bills, receipts, etc.

-Essential documents.

-Fun things, like motivational posters.

If your paper stores are generally organized, work through them one by one. But if you’re finding your post with your past bills and magazines and receipts in your briefcase, you may as well empty them into one pile to work through.

2: First sort. Bin or check.

The first time we go through our paper, we need to just ask if we want to bin or keep it. Plenty of things can be thrown away immediately. Anything that won’t be put in the bin or the recycling goes into another pile.

3: Second sort. Store, use.

The second time we go through our paper, we decide whether the paper needs something done, like a bill that needs paying or a magazine you want to clip things from, or just needs to be stored like payslips or important documents.

4: Third sort. Folders.

Take your store pile and assign a folder for every category of paper. Use the categories above, or even break them down, such as bills into water, gas, electric and tax, or homework by class. As you sort them, arrange them by date, with the oldest at the back. Make sure to add the newest at the very front of the folder each time.

5: Go through.

Once a year, go through your folders and get rid of anything you no longer need. Bills older than five years can easily be thrown away, though you may not keep bills older than one or two. Either way, it should be a simple matter of taking the papers nearest the back and recycling, shredding or burning them. If not, it’s time to sort again.

6: Keep out.

Make sure your folders are easily visible and usable, otherwise you start creating more paper piles. When you are sorting something, make sure you get whatever it is done and then put the paper away.

And that is how I declutter my papers. It does take a while, but it’s absolutely worth it and at least it gives you an excuse to procrastinate, watch TV, take a call and drink coffee for a couple of hours.

TTFN and Happy Hunting!

What does your paper drawer look like? Is it driving you crazy, like it used to drive me crazy? How do you keep on top of paper clutter?