Controlling expenses is important because you can, among other things, acquire more security and comfort when making new investments. Read on to learn how to get your finances in order too!
Many people have already realized how important it is to control their expenses, organize themselves financially and invest in the future. But, that is only possible when you monitor all the money that goes in and out of your account.
If you are reading this text and thinking that even if you do not keep a rigid control of your finances, you know more or less how much you spend per month, you may be scared when you discover that you are using a large part of your income in transportation or food applications outside the home , for instance.
Also, if you are a freelancer or digital influencer, it is much more important that you separate the expenses of your personal and professional life, because, although your income varies from month to month, many expenses are fixed.
So if you want to plan your life and keep your accounts up to date, take a look at our suggestions!
Controlling effective expenses means more than just registering expenses and income and filing taxes. By monitoring personal or business expenses, you can find patterns, compare time intervals, measure profitability and results to make decisions.
If we were to define the concept of cost control, the first word that should come to mind is “financial strategy”, since cost control is a financial strategy that seeks to reduce spending and maximize the benefit of resources, prioritizing the alternatives with the best profitability.
Being a strategy that covers numbers, it is possible to compare these alternatives in a very simple way, and despite the fact that most of the time the analysis focuses on the financial, there are also external factors that could impact the control of expenses and the strategies used.
It’s normal for people to know exactly how much they earn per month, even if they don’t have a steady job. But when asked how much they spend, most don’t know how to answer precisely.
Digital work has a certain independence compared to the traditional market, but it also requires financial organization, and the best way to achieve it is by using a spreadsheet.
Of course, it is not necessary to use very complicated spreadsheets, as this could discourage us from doing the necessary monitoring. But, it is important to always remember that controlling monthly expenses helps you think about new achievements.
A spreadsheet also allows you to calculate various metrics like ROI with some formulas.
Return on investment is a financial metric used in business. It serves to measure, as its name suggests, the return on investment and thus demonstrate the financial health of a brand.
Therefore, for a business to work and to be able to make decisions, it is necessary to make plans, have reserves to invest and working capital that keeps your brand in the market, even when the offers are not at their best.
Starting to do this organization from scratch can be difficult, but there are programs and applications that help you simplify it.
On the computer, you can use Excel or Google spreadsheets, which update the values online and store them in the cloud.
In addition, some cell phone applications such as Mobills , Accounting Registry and Wallet help you create payment reminders, integrate with card expenses and with the bank account, and even notify you when you exceed the defined values.
With financial life up to date, an entrepreneur can feel more secure and comfortable to make new investments, pay their bills and avoid unpleasant surprises. Here are other advantages that cost control offers you!
1. Propose long-term goals
Only with an organized spreadsheet can you set goals for the future. Currently, do you know how much you can invest? Do you have an emergency reserve or are you saving money to fulfill a dream?
Financial control helps to set goals, because it objectively shows how much is coming in and how much is going out. In this way, you can create your monthly goals, for example, to save a certain amount of money by the end of the year.
2. Have access to important information
By organizing your data, you will be able to consult it in an easy and practical way. Therefore, we recommend that you use forms for computers or mobile applications.
By updating and monitoring what comes in and out, you will know on what date you are going to collect, how much you can spend in the month or how much you exceeded your limit.
3. Reduce costs and expenses
After organizing the information and discovering how much you spend, you will be able to make cuts, since you will be able to analyze which are the costs and which are the expenses.
Fixed costs include rent, electricity, internet, telephone, water, food, and you can hardly cut or reduce them.
Therefore, it is easier to eliminate expenses. You can make it a point to cut down on your use of transportation apps, eat out only on weekends, and buy new clothes only on special occasions.
4. Make effective decisions
To make decisions and assume financial commitments, it is necessary to have up-to-date accounts.
For this reason, financial organization and expense control allow you to make long-term investments, request loans when you need them, and make purchases in installments (or months). You can do all this because, with the data on your form, you have been able to plan your earnings expectations and your expenses.
As we have already said, we recommend that you organize yourself financially through a spreadsheet.
Here you can see how to do your expense control using Google Sheets !
1. Create the spreadsheet
Divide your spreadsheet into months and expenses. At the top of the 12 columns, place the months.
On the side, you must write all the expenses, such as: food, rent, electricity, water, transportation, brand investment, personal expenses, etc.
2. Monitor what goes in and what goes out
This part may take a while, because you will need to remember and write down all the expenses and income for the month.
First, it places the received values. Write down everything you have earned, whether in cash, transfers or checks.
After a while, you will begin to write down all this information on the cell phone to update your table when you have time.
Monitoring what goes out is easier. Find your receipts, go to the transfer area of your account and view your credit card statement.
It is important that you also write down the small expenses in money. A coffee, a dessert after lunch and a drug at the pharmacy may seem insignificant, but when added together they represent a large part of your budget, which you could reduce.
3. Add the expenses and compare them with the income
In the last line of the table, you can create a formula with the “sum” function that will show in an organized way how much was spent in the month.
Just type =SUM() , inside the parentheses, put the line x column range you want to add. Or else, click Insert > Function > SUM .
At this time, you will know how much you earned and how much you spent. Thus, you can define where you need to save and how much you want to save monthly.
After a while, with a few months already organized, you will be able to create spending goals and analyze other information. For example, in which months of the year you spend more and in which you earn more.
Also, as long as the budget is in order, do not leave the money standing in your account: look for investments!
We will hardly find successful entrepreneurs and influencers who do not maintain good control of expenses. Although it is a laborious task at the beginning, you will realize that it is worth it and brings many benefits.
These actions will show expenses that you did not even imagine and habits that can be modified, without this meaning a change in your living conditions, for example.
Having good financial control is essential for digital producers, as well as the need to analyze and quantify their actions on the Internet.