Where your money goes
When I finally looked at my spending, it wasn’t one big thing. It was rent, then a hundred small things, then one surprise bill I’d completely forgotten about.
Not all expenses behave the same way. Once you can sort them, you can see which ones you can change, and which ones are going to ambush you.
Three kinds of expenses
Fixed expenses cost about the same every month: rent, phone plan, subscriptions, loan repayments. They’re easy to plan for, but hard to change quickly.
Variable expenses change from month to month: food, transport, going out, data top-ups. This is where most people have the most control.
Irregular expenses don’t come every month, so they’re easy to forget: a yearly renewal, a broken phone screen, birthdays, travel, festive season spending. They aren’t really surprises. You just didn’t plan for them.
Every December I acted shocked that December happened. Then I started setting a little aside every month for it.
A simple trick for irregular expenses: add up what they cost you in a year, then divide by 12. That’s how much they really cost you each month, even if you only pay once.
Watch out for money leaks
A money leak is a small, repeating cost you’ve stopped noticing. On its own it looks harmless. Together, leaks add up fast:
- Subscriptions you rarely use
- Delivery fees and service charges
- Bank and transfer charges
- Small “treat” buys you don’t remember making
Say you have three subscriptions at $12£10€10₦4,500$12 a month each. That’s $432£360€360₦162,000$432 a year, often for things you barely use.
How to see where your money really goes
You don’t need a perfect system. Pick one of these and do it for a month:
- Use your bank statement. Go through last month’s statement and mark each line as fixed, variable or irregular.
- Track as you go. Note each spend in your phone’s notes app or a simple spreadsheet the moment you pay.
- Use your bank’s app. Many banking apps now sort your spending into categories for you.
