The golden rule for staying out of debt is to spend less than you make, but that’s kind of hard to do without keeping track of your money. If the thought of budgeting makes you cringe, keep in mind there’s no one “right” way to do it. And if you’re one of those people who has no interest in newfangled budgeting tools like mobile banking apps, online dashboards or even a spreadsheet, there are a few no-tech strategies for staying on top of your finances (and, consequently, avoiding the fees and credit score damage that sometimes come with overspending).
1. Pencil & Paper
Whether you choose to use the ultimate throwback to a physical notepad and pencil or you prefer to jot things down in a digital notebook, the simple act of writing down your purchases can have a significant impact on your spending habits. You can’t ignore the fact that you’re spending $15 on lunch every day when you see it over and over again in your notes.
The “write-it-down” method can be as simple or as intricate as you prefer, with a mere list on the simpler side and a matrix of spending totals and categories on the other end of the spectrum. You can take the process a step further and do some math: Make a note of how much money you’re earning, and subtract from that total every time you make a purchase. Seeing the numbers go down may make you think twice the next time you buy something. (Bonus old-school points: Skip the calculator and do the math by hand or in your head.)
For all the advantages credit cards offer — rewards, fraud protection, purchasing ease, etc. — they have a pretty big disadvantage: temptation. It’s so easy to overspend when you can buy now and pay later, rather than have to reckon with the hard numbers in your bank account before you approach a cash register.
But there’s no arguing with cash: You either have enough, or you walk out of the store empty-handed. If you need to stick to a spending limit of $100 a week, but you struggle with self control, you may just want to put $100 in your wallet on Sunday and force yourself to avoid the ATM for seven days.
3. A Check Register
Though checks aren’t exactly a popular form of payment anymore, debit cards are, so the check register still has utility for someone who wants to keep close tabs on their checking account balance. (And these little paper books are relatively portable.) Each month, you can double check your math with your account statement.
Still, it’s important to check your bank account activity online, because if you let debit card fraud go on undetected for several days or weeks, you may be liable for some or all of the unauthorized purchases. Additionally, if you don’t notice your account is missing money, bill payments may not go through, which could lead to late fees or debt collection activity on an unpaid balance.
If the “write-it-down” method appeals to you, but you don’t want to have to take notes immediately after every purchase, holding onto your receipts is a good way to track your spending. Pick a regular interval, like the end of every day or each week, to sit down with your receipts and figure out where all your money is going. You may not think you spend that much buying coffee every day, but that stack of Starbucks receipts may suggest otherwise. Just don’t forget about e-receipts, which are becoming much more common at payment terminals.
It’s understandable if you want to limit your use of high-tech personal finance tools out of privacy concerns, but it’s also important to point out that the threat of identity theft is everywhere. Regardless of if you opt for a low- or high-tech approach to personal finance management, make sure you take time to regularly review your credit reports and account information for accuracy. You can get your free annual credit reports from the major credit bureaus at AnnualCreditReport.com, and you can also see two of your credit scores for free, updated every two weeks, on Credit.com.