Accounting For Every Penny (With a Bonus)

Thanks to a gift from a close friend, I’m now listening to ‘An Autobiography: The Story of My Experiments with Truth’ by Mohandas Karamchand Gandhi. I had attempted to read it a few years ago as we have a hard copy at home but I couldn’t get through it. Getting through the audio has been an absolutely pleasure.

M.K.Gandhi has had massive impact on the history of India – both positive and negative. While I was a student, I realize I looked at the negatives a shade too much and this book has been a nice reminder of how much there is to learn from the man. And I’m sure there are more learnings to come as I make progress in my reading.

This post is inspired by a line in the book I was very inspired by. This was during Gandhi’s years as a student in England. He says (paraphrased/roughly) ‘I always accounted for every penny that came in and went out. This is a habit I would encourage all youth to develop. It is this habit that enabled me to handle public funds with relative ease and has stood me in good stead all through my life.’ 

Members of this blog’s community have seen me struggle through the journey over the years. I was living on borrowed cash after being bankrupt in university when I started blogging. And then, there was progress over the next year to a tight life style until I was sure I had sufficient control over my finances (and had paid off my debts). And then, after a year or so of living well below my means, the next objective was to track all my expenses. Precise tracking was a real struggle and I’ve finally solved that problem thanks to the Envelopes app on my phone. And, since May, I’ve been able to start living with budgets. (I’m admittedly lax about getting on the wrong side of my budget now though as I have sufficient confidence in my ability to live well below my means but that’s only after 2 years of having done so)

I maintain all of this on a Google Spreadsheet. I’m aware of many great apps that help automate this but I’ve resisted them simply because I like to keep control of the process.

This journey has taken me a good 4 years. Call me a slow learner if you will but it’s felt like a great accomplishment even if it’s taken that along. The juice feels worth the squeeze.

Gandhi’s advice though, pushed me a step further. As I was working on my end-of-month finances today, I wanted to have a clear understanding of my cash flow in addition to my balances, savings and the like. And I worked on my Google Doc to fully understand just that. The end result was an additional sheet which helped me understand my cash flow, averages of how much I spent – essentially every thing I need to understand and account for every penny I spend.

I believe in the tremendous power of the habit. I daresay the whole world needs this. One needs to look no further than the financial crisis to realize the potential impact of every one of us living below our means. Simply put, we need to get into the habit of making every penny count.

So, as a bonus, I thought I’d share with you a template that might help you on your ‘Account for every Penny’ journey. Please find it on the Google Spreadsheet

2 things to note  here –

– This is exactly the sheet I use myself, with dummy numbers. So, they may not make sense across sheets (they will, when you put original numbers in).

– This sheet is just version 1. There is a lot of functionality that can be added, of course (linking numbers between sheets, charts graphs etc). I thought I’d try and keep it as simple as I can. I’ll let the Excel Geeks go crazy with adding additional stuff. :)

 I’d appreciate hearing from you on anything you feel is missing. And, of course, I look forward to any questions you might have.

I hope you find it useful.