Wednesday, September 16, 2009

Lessons from tracking my spending

This year, I embarked on an experiment, borrowing a page from frugal livers' books: record every penny you spend.

I planned to work less when I turned 60, and entering this transition, had only a hazy sense of exactly where my money went. I wanted to be more aware of what I consumed, especially for discretionary purchases, like clothes and accessories.

This year, I recorded the date, item, original price, and actual price for every personal expense, an illuminating activity.

My bigge
st expense so far: several thousand dollars to restyle a ring I had not worn for years. Absolutely worth it- I'm enjoying what sat in a box.

One of the sma
llest purchases: a vivid Indian cotton skirt picked up for $50 in a Buffalo boutique, bought because I hadn't packed enough for a trip. After my vacation, I went to Toronto's Little India and found this one, printed with peacock feathers and strewn with silver sequins, on sale for $20!

At about eight months in, my observations so far:


1. I'm still a
sucker for 50%-75% sales. A number of summer-sale tops went unworn. Seven Day Hypothesis: If you're not wearing an item (bought in season) within one week, it's better off left in the store.

I bought a few off-season items in the spring; if I don't wear them regularly this fall, that's another faux pas.

2.
Care counts: I wrecked the most expensive garment, an Italian silk jersey skirt, when I machine-washed it on delicate (not in a bag, the fatal error) rather than dry clean or handwash, as the tag specified. Cost per wear, astronomical. Lesson, priceless.

3. Dry cleaning was a big ignored expense.
I'm no longer willing to reflexively incur this expense so am more interested in clothes I can maintain myself.

4. My look/buy ratio has shifted from 1:1 to 8:1.

In past years, my brain on shopping was conditioned to, "This is when I buy something." I had to re-program it to, "I am having fun looking." If there is something that interested me, left it to the next day, the allure usually vanishes. Sometimes I can't recall what it was.

5. I still love buying gifts. Can't wait till unsuspecting (and un-blog-reading) Birthday Girl Ruth opens the sweater with big blue fox cuffs that Mireille still had for sale at Thrill of the Find!

Many months, my gift purchases were the biggest category. I don't spend for
the sake of buying a lavish gift but if it's right, wrap it up!

6. I want my good-cause giving to be higher and am working on that. Several GFs and I have altered our holiday gift exchanges so I will have more to donate.

Anyone else tracking spending? Notice any shifts?

18 comments:

Deja Pseu said...

Up until the last decade or so, I made very little money and so spending on my wardrobe was quite limited. I feel as though I've been on a years-long binge after a spending diet. I've just begun to put myself on a spending moratorium while I pare down and refine my wardrobe, so that I can make every penny spent count. I too get sucked in by sales, and find that rarely are those items worn or satisfying.

materfamilias said...

I'm like Pseu, catching up after years of a limited budget, but I'm close to being there and to switching my clothes spending somewhat. Over the past few years, we've been doing more and more good-cause giving, being lucky enough to have two (separate) friends who have started very credible projects in Africa and in Cambodia. As well, two of our (adult) kids have returned to school and we're helping with that -- at least we pick up some AirMiles!!

Belle de Ville said...

I don't track my spending per se but I limit the amount of time that I go shopping to about one day per month. That way I can't do much damage.
I also have an issue with my dry cleaning expense. I try to get more wear out of my clothes before I send them to the cleaners.

see you there! said...

Clothes spending hasn't been a problem. I've come to hate shopping due to high prices for poor quality.

Food spending is another story and my weakness. I won't admit the price I paid for some fancy cheese recently.

Darla

LPC said...

I'm impressed. And I'm with you on the shift from purchase to self to purchase for others.

diverchic said...

Tracking money! What a terrifying idea! Maybe you can teach me how to do it so I don't get tangled up in the details.

Frugal Scholar said...

This is just fascinating. According to all the frugality books, once you start being conscious of your spending, you will--without trying--spend 20% less. I've never kept good enough track to see.

I myself am spending MORE this year on pieces. I'm hoping this will cut down on the overaccumulation. But then I find treasures I hid away--like a vintage leopard jacket (not real, I hope--seems to be printed on hair calf). So: spend MORE on a few things. See what's hiding in closet.

I almost died when I read about your silk skirt. So awful. It's unfair, but only the nicest things attract ruin.

Oh, and yestereday, I typed bete noir and spent the day thinking of my French teachers chasing me with their red pens. LA bete. NOIRE. Feel better.

metscan said...

I´m feeling very guilty reading your post. I simply have not had the courage to write down everything I have bought. It adds up to too much. Starting a shopping ban is a way to start controlling myself. I so hope it will work.

Northmoon said...

What happens if you are still thinking about an item after several days?

I was buying a pair of black wool pants in a friend's store, when he said "try on the jacket" I said "sure".

Now I'm obsessed by a thousand dollar jacket that's perfect in every way. Except that I wasn't shopping for a jacket, and that's a lot of money. Still it goes with the pants, it looks good with jeans, it's couture quality, and I look so good in it!!!

I tell myself I'd rather have it than several sale items which I would no doubt buy mindlessly over the season. I should keep track of every item of clothing I don't buy until I have the cost of the jacket covered!!

I've got donations that come off my credit card automatically each month. I don't miss the smaller amounts as much as making one big annual donation.

Imogen Lamport said...

Great points - love No. 1 - shows your retail weakness that you now know to be careful of!

Point 3 is something I'm always aware of - I dry clean rarely, so my clothes have to machine wash.

Point 5 - your friends and family are very lucky, everything you've written about gift choice makes me envious!

Duchesse said...

Pseu: Thanks for the sale sympathy, you ar so right, sister.

ma: Ones' kids are always a tempting (and necessary) place to spend money! And you are lucky enough to have another generation too.

Belle: I can inflict intense damage in 10 minutes, maybe less! My haberdsher godfather recommended to airing and brushing
and said that most people over-dryclean.

Darla: Can you believe the price of great cheese? But cannot resist.

LPC: Thanks, it sounds anal but has been illuminating.

diverchic: Take me to lunch and I will show you my method- then we cna go to that new goldsmith you told me about.

Frugal: Your blog inspired me to do it, merci!

metscan: Don't have a ban on shopping. That's like a diet for me: becomes all I think about.
as they say, "What you resist, persists."

Northmoon: Sounds like a marvelous jacket. Please let us know what you do. I like your strategy of 'did not buy, have this instead'.

imogen: Gave her the sweater last evening; fit perfectly- she was ecstatic. Probably $500 value I got for $55- consignnment, never worn.

Duchesse said...

Belle- whoa, typos! My haberdasher godfather recommended that people hang woolens to air and brush rather than dry clean so often.

Mardel said...

I've been really tracking my expenses this year, and really trying to think about what I spend the money on, and why, and whether the purchase was worthwhile whether it was inexpensive or dear. I don't have a coherent set of results yet, but I have found that I think far more about what I buy and what I want.

I love shopping as a looking expedition. Shopping expressly to buy leads to too many mistakes, at least for me. If I take time to look, I can buy when something really sticks. Of course sometimes I spend too long deciding and miss the opportunity. Oddly no matter how desperately I thought I wanted that thing, once the initial upset is over, I don't really remember it. I think this is my biggest lesson.

And I agree wholeheartedly that something worn and enjoyed is worth so much more than anything in a drawer.

s. said...

Oh, Duchesse. I'm not tracking my spending, but your post made me smile, nod and - most important - stop and think. I do love your blog!

Completely Alienne said...

I have not tried to track it (though my bank statements would give me a rough idea) but I am pretty certain that the teenagers suck up most of my spare cash. And the eldest is starting her driving lessons next week ... I think it might be too depressing to track for a few months, though it would be good discipline to try, perhaps in the New Year.

kristophine said...

I'd never thought about the one-week rule--I should really keep that in mind. Also, do I ever hear you on the wrecked skirt. Farewell, poor silk tanktop that I only wore once!

Duchesse said...

Alienne: Bank statements supplied some info but not where casual spending went, or how many items I typically bought each month, and info about full vs sale prices- in other words, I wanted every detail.

Kristophine, that rule was a direct result of this experiment- thanks for the sympathy on the skirt.

Lindy said...

I have ALWAYS tracked my spending, along with compiling monthly net worth statements. Believe me, it is a powerful tool for not wasting money and accumulating wealth. I find that tracking my expenses prevents me from frittering money away, particularly on eating out. Try one of the software tools, like Microsoft Money or Quicken.