How this bookkeeper handles her personal finances.

It took a long time to motivate me to really implement a “system” for my personal finances. I watched my spending in a general sense but I was not nearly as involved as I should have been. Now, I can tell you exactly where my money goes.

We don't have the time or character limit to address all the events that set a fire under my ass, but this is the process that got me dialed in:

I started with a spreadsheet with all income & expenses. This is crucial, so take the time to include as much data as possible.

Calculated the “the world has gone to hell” minimum income needed to be to live my life. This covers just the absolutely necessary basics like housing, transportation, utilities, etc. You (hopefully) won’t actually need to function at this level, but it’s important to know.

I sorted my expenses into three categories: “Predictable Needs” for things that will be exactly the same every month (mortgage, insurance, etc), “Flexible Needs”, for amounts that can vary to some degree (fuel, groceries), and “Wants”. By breaking these down, you can quickly dive into the “wants” or “Flexible Needs” when you need to make spending cuts.

From these categories, I was able to see where my money was going & make better decisions about my spending, so I took it one step further. I set up four accounts: Basic Checking, Bill Checking, General Savings & Special Purpose Savings. Here is the flow:

Paycheck comes into Basic checking

Transfer appropriate amount to Bill account & savings

Basic checking remainder is for discretionary spending

As many bills as possible auto paid by credit card (that earns airline points)

Pay off card in full automatically with bill checking

It’s important to note that over time, I have built a little buffer in the “bill” account as a safeguard & it is “backed up” by my savings account through the bank. Eventually, I upgraded my spreadsheet to a low cost paid app & my savings is now in a HYSA, but this is where I started to gain confidence & momentum towards more stability. Getting your finances under control doesn't have to be complicated. Start simple & make adjustments until you have a system that works for your life & preferences.