Welcome back to The Self-Reliant Steward Podcast. I’m your host, Damia Shimmin.
Today’s money trivia question is:
On average, how much money do American’s spend on fast food each month per person?
Answer: $148 per month
For a family of four, that would add up to be nearly $600 a month. That’s over $7,000 a year!
Do you know how much money you spent on fast food last month compared to the month before? How can we know where our money is going or how much progress we are making if we don’t keep track?
Not tracking spending is the sixth of eight mistakes teenagers make with money that we are discussing in this series on the podcast. My objective is to help all of us recognize areas of money we can discuss with children and teenagers to help them avoid or overcome common money mistakes, and by so doing, become self-reliant and wise stewards of the resources the Lord blesses them with.
If you don’t know what series I’m talking about, go back to episode 1 of the podcast and I’ll see you here when you’re caught up.
Now, let’s dive in!
In 2014, Michigan State University conducted a study about tracking progress and accomplishing goals. “The results of the study showed that 76 percent of participants who wrote down their goals [and] actions and provided weekly progress to a friend successfully achieved their goals. This result is 33 percent higher than those participants with unwritten goals, with a success rate of only 43 percent of goals achieved.”
President Thomas S. Monson, who was the 16th president of The Church of Jesus Christ of Latter-day Saints stated, “When performance is measured, performance improves. When performance is measured and reported, the rate of improvement accelerates.”
When we measure our progress on anything, be it a goal to be able to run a marathon, or measuring our progress towards a financial goal, measuring progress helps us see the progress we are making. Being able to see our progress can help motivate us to keep going. It can also help us see any adjustments that we could make that could help us achieve our goals.
When we don’t measure our progress, it is hard for us to look back and remember what we have accomplished. We are likely to either not see any progress or to assume we are doing better than we are.
A few months ago, I was talking with a relative of mine. She wanted to read more, but she consistently said she doesn’t read much. I could see that she reads more than she thinks, so I showed her an app where she could keep track of books she has read and wants to read, as well as track her progress on books she is currently reading. In less than 10 minutes, this relative was able to see that she reads at least four times as much as she thought she did.
Since using that book app, this relative of mine has also started using a habit tracking app. She went from knowing a handful of German words and phrases to spending about 10 minutes a day learning German.
She previously felt guilty when walking by her bookshelf full of books she wanted to read. Now, she reads at least 5 minutes every day, and many days she reads upwards of 30 minutes. We are just barely a month into the year and she has already finished reading four books!
Now, what does all this about tracking and measuring progress towards our goals have to do with tracking spending? Everything!
Recently, I talked with a woman who started an online business a little over a year ago. She has not been tracking her business spending this whole time. Now, she is inputting all the business transactions from 2023, so she can to do her business taxes. She has been working on entering the transactions for a few minutes every day for about two months now, and she is still not finished.
If instead of waiting until two months ago to start tracking the business transactions, she had taken time each week to enter those transactions, she would be ready for tax time in a couple hours or less.
Tracking spending not only saves us time when we get ready to do taxes, it also allows us more freedom. This same woman told me that she does not know where she stands financially, either for her business or her personal finances.
She told me that the other day she put $500 in her savings account. A few days later, something came up that she wanted to use the $500 for, and so she did. Later that same day, she realized that she had originally intended the $500 for a specific purpose, but then forgot that purpose…until she had already spent the money on something else.
Now, she has to wait and find another way for the original purpose.
Confession time: I am not always consistent at tracking my spending and I experience the consequences. One time, in working on my taxes, I realized, like the woman I just talked about, I had not yet imported all of my expenses into the software I used. I had to spend an extra 30 minutes or so adding the transactions I had not yet entered before I was ready to do my taxes.
Dedicating a specific and regular time to tracking our spending will save us time and money, and help us become wise stewards of what the Lord has blessed us with.
Especially, if we also have a good tracking system.
When my mom first left home and went to college, she did not have a good system for tracking her spending. She neglected to write her ATM withdrawals in her checkbook. With that mistake, she overdrew her account multiple times and had to pay overdraft fees.
We need to know how much is coming in and going out in order to live within our means. Creating a budget is only half the process.
Creating a budget and then not tracking spending would be like making a meal plan, but then going grocery shopping without a grocery list or the meal plan. Then, even if you look back at the meals you planned, you don’t have all the right ingredients for every meal.
In order to achieve financial self-reliance, we need to budget and track our spending. Budgets are the plans, which can be adjusted as we go. Tracking spending is how we make sure we are following the plan and moving towards the goals and outcomes we desire.
Luke 14:28 says, “For which of you, intending to build a tower, sitteth not down first, and counteth the cost, whether he have sufficient to finish it?”
As we build a building, or follow any other plan, we need to consistently evaluate if we are following the plan and the budget, to make sure it is finished properly and we don’t run out of money.
Now that we have talked about tracking spending in general, how can we help children and teenagers learn to track their spending?
Suggestion #1: Print out a chart and hang it on their wall for them to fill out every time they earn or spend money.
Suggestion #2: Use cash only. When I was a teenager, I kept my money in a binder with pencil cases in it. Each pencil case held money for a different category. Once the money in a category was gone, it was gone.
There is at least one disadvantage of only using suggestion #2. When I was a teenager and kept my money in a binder, I occasionally felt like I was missing money. To this day, I still don’t know if I just forgot that I had spent some of that money or if someone was stealing money from me.
This experience shows another important reason for tracking spending. It is important to keep track, specifically with bank accounts, so that fraudulent charges can be quickly and easily identified and reported.
Suggestion #3: Sit down with your teen at a regularly scheduled time and track your spending together. You don’t have to do it with them, but if you set aside a time for yourself and they know what you are doing during that time, you will become a good example to them of a wise steward. Teaching them through word, in addition to being an example, is usually the best way to teach children and teenagers about money.
Applying all three of these suggestions will make the greatest impact in teaching teenagers to track their spending.
Stay tuned for next week as we talk about the seventh out of eight mistakes teenagers make with money and how to help them avoid or overcome these mistakes and ultimately become self-reliant and wise stewards of what the Lord has blessed them with.
Show Notes
Was Someone Stealing My Money?
Listen to find out the story of when I wondered if someone was stealing my money and the importance of tracking our spending. Tracking spending is the sixth of eight mistakes teenagers make with money discussed on the podcast to help parents help their children and teenagers avoid or overcome these money mistakes.
The Self-Reliant Steward podcast helps Latter-day Saint parents learn how to teach their teenagers to become self-reliant and wise stewards of what the Lord has blessed them with.
Sign up for free “20 Best Jobs for Latter-day Saint Teens” download: https://harmonylivingcoach.com/20-jobs-for-teens
Trivia answer: https://www.driveresearch.com/market-research-company-blog/fast-food-consumption-statistics/#FFCS2
Michigan State University study: https://www.canr.msu.edu/news/achieving_your_goals_an_evidence_based_approach#:~:text=The%20results%20of%20the%20study,43%20percent%20of%20goals%20achieved.
President Monson Quote: https://www.churchofjesuschrist.org/study/manual/starting-and-growing-my-business/2-what-do-people-want-to-buy/report?lang=eng
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