Monk In Tee

For the last 15 years, I’ve maintained my personal balance sheet and income statement, and it’s been one of the most impactful habits I’ve developed. Over this period, I’ve gained a clear understanding of my spending patterns, frequency, and—most importantly—the ability to distinguish between necessary and unnecessary expenses. This habit has given me the financial control that no app or financial advisor could provide on its own.

While it’s important to seek professional help when required, no one should hand over complete control of their finances. The insights you gain from tracking your own money flow are unparalleled. Here’s why you should take a hands-on approach to your personal finances, and how it has changed my life.

Why I Chose to Track My Own Finances

Well, I started this just out of curiosity. Possibly the habit I saw in our previous generation could have played back in my mind. Sure, I was saving some, but I had no real insight into my habits. What started as a simple exercise quickly became an eye-opener and moved from a simple excel sheet to more evolved dashboard.

1. Understanding Spending Patterns
   One of the first things I learned was how frequently I was spending on non-essential items. Regular expenses that seemed small—like daily teas or coffees, impulsive purchases, or dining out—were adding up. By documenting these expenses, I could clearly see where I was overspending. The act of recording my transactions helped me to look closely at what I was doing with my money.
2. Differentiating Needs from Wants
   The simple task of classifying expenses—needs vs. wants—was a game changer. It’s easy to convince yourself that you “need” that new gadget or an extra streaming subscription, but when you see it on paper, it’s harder to justify. Over time, I developed a clearer understanding of what was truly necessary for me to live comfortably, versus the expenses that were driven by fleeting desires.
3. Spotting Trends and Adjusting
   As you progress through life stages, your spending pattern changes. If you don’t track the expenses, you end up with discretionary spending creeping up. With the recent proliferation of delivery apps, digital payment integration, it has become even more difficult to resist impulsive desires. While we have all the data readily available, it is really about whether we actually see it.
4. Developing Financial Discipline
   When you personally track your finances, you start thinking critically about every purchase. Over the years, this discipline has become second nature to me. Now, I can assess potential purchases almost instantly—”Is this a need or a want? How does this fit into my overall financial picture?” It’s a habit that has saved me good amount of money and given me financial peace of mind.
5. Gaining Control Over Financial Decisions
   After 15 years of tracking, I’ve reached a point where I feel confident making financial decisions, both big and small. Whether it’s choosing to invest in new opportunities or cutting back on non-essentials, I no longer feel unsure. Every decision is backed by years of financial insight. You are aware of your inflation factor. This has empowered me to take control of my financial future, rather than simply reacting to circumstances as they arise.

Professional Help is Important—But Not a Substitute

There have been times when I’ve needed professional advice, especially around taxes and long-term investments. But I always approach these conversations armed with my own knowledge of my finances. Instead of relying solely on someone else to handle things, I use their expertise as a supplement to my own understanding.

The key is finding a balance. Professionals can provide valuable insight and guidance, but they should not replace your involvement. After all, no one knows your financial habits better than you do.

How to Start Your Own Financial Journey

If the idea of tracking your finances sounds overwhelming, don’t worry—it’s easier than you think. Here’s how I recommend getting started:

1. Start with a Simple Balance Sheet
   Record your assets (what you own) and liabilities (what you owe). Don’t get too caught up in perfection—just get something down on paper or in a spreadsheet.
2. Track Income and Expenses Regularly
   Every time money comes in or goes out, make a note of it. I began with monthly tracking, then moved to weekly as I got more comfortable. Over time, it will become second nature.
3. Review and Adjust as Needed
   The magic happens when you regularly review your finances. Look for trends, identify unnecessary expenses, and adjust as you go. This habit will evolve over time, and before you know it, you’ll have a much better grasp of your financial life.
4. Don’t Hesitate to Seek Help
   Just because you’re managing your own finances doesn’t mean you can’t seek professional advice when needed. Whether it’s tax optimization or investment strategies, there are areas where expertise can make a big difference.

Final Thoughts

Taking control of your finances isn’t just about numbers; it’s about understanding your relationship with money. My journey of maintaining a personal balance sheet and income statement has given me the clarity and confidence to make informed financial decisions. It’s a discipline that I believe everyone should develop, regardless of their income level.

If you’re not already tracking your finances, I encourage you to start today. Take charge of your financial future—you’ll thank yourself later.