Track Your Spending, Achieve Goals, Have Less Anxiety and Happier Relationships

The frog in hot water never realized the water was getting warmer. “It was cold when I got in,” he said. Suddenly the water is a turbulent heavy boil. How did this happen? There was no thermometer, no way to track the slow but steady rise in temperature. Gradually, but inevitably, that poor frog was cooked.

We’re not frogs, right? We have opposable thumbs. We’re not amphibians, and we’re fairly durable and aware. But all of us, in some ways, are like frogs. We get so caught up in the busyness of life and lose ourselves, often to our detriment.

Self control, progress and small acts

My wife says I have decent self-control. I also have a bag of chocolate covered almonds with sea salt in my desk. It’s a big bag from Costco. They are delicious. Like kryptonite, they have actually proven stronger than me. I eat them deliberately at times, and almost unconsciously at times. When I’m tired or stressed, it’s like magic. An almond appears in my hand!

We don’t develop heart disease in one day, nor do we gain much weight in one day. We don’t bury ourselves in deep debt in a single day (usually). All of these troubles take time. They are the result of many, many actions.

Similarly, we don’t become fit in one day. We’re not prepared to run a marathon after training for one day. Financial fitness doesn’t happen overnight. Small acts push us forward.

So our riddle is this: How do we stack up the small actions in life so we’re moving forward, not backward? How do we make sure we’re not the frog that finds itself in boiling water?

Tracking to stay aware

The secret is tracking. We’ve long known this intuitively. Any coaching or improvement program is based on tracking, but how does this relate to finances? We decided to learn more.

We recently did a survey of real people who track their money. Using a market research firm, we surveyed 100 people who have been tracking their spending and their finances for three months or more. These aren’t Tiller users (although I bet they’d love to know about Tiller).

Are you sitting down? Here’s what we found.

  • 75% of people who track their finances feel less anxious about money than before
  • 80% of people who track their finances have a better relationship with their spouse/partner than before
  • 93% of people who track their finances have better insight into their spending habits than before
  • 79% of people who track their finances spend less impulsively than before
  • 81% of people who track their finances feel more confident about achieving their financial goals than they did before

Who wouldn’t want to be in that 80th or 90th percentile with the people who feel in control, who are happier with their spouses, who are marching forward toward their dreams?

What did they have for breakfast that made them so special?

The answer is profoundly simple. They were paying attention. They were tracking their dollars.

Simple math paints a big picture

The average American will make over $50k this year. Let's assume, conservatively, they work for 40 years. The math says they’ll have more than $2 million dollars run through their hands during their working life. This is simple and conservative math, and I’m assuming none of those dollars are invested to earn more dollars.

So $2 million. If you’re an average American, what are you going to do with your $2 million dollars? Most Americans don’t know where they will spend, or perhaps already spent, their $2 million. No idea. It will come, it will go. Life will zip by.

A few will feel in control. A few will achieve their dreams. A few will leave a legacy with the ways they’ve invested and spent that $2m.

Is this something that only the wealthy can do? Do you need a Goldman Sachs advisor to be one of the few who reaches your goals? No! Use a spreadsheet. Use pen and paper. Use marbles or pebbles or chalk. Just start tracking. Start paying attention.

Resolutions aren’t just for new years

So let’s all resolve to start tracking. Start paying attention to what’s important. Whether it’s a curse or a blessing, whatever your relationship with it, no matter how much you have or don’t have, money should be something we all track. Bill Gates does. So does my good friend who’s clawing his way out of debt.

Let’s keep track. Let’s make our money serve us, and let’s start today. Not tomorrow, but today.