How to Check Your Spending When Finances Feel Scary

An Exercise To Help Cut Your Monthly Expenses

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We are experiencing something right now that is unprecedented, and let’s face it, it can be a little scary. Absent the fear of the virus itself, there is the financial insecurity that comes with the uncertainty of the economy or even a job loss. If you are like a lot of people, the financial worries make you want to bury your head and not think about it. However, now is a good time to start making some immediate decisions that can help later.

Before you can make decisions about cutting expenses, it’s a good idea to try to understand where your money is going. I’m sure your first thought is…”I already know where my money is going!” Sometimes, taking a more granular look at your expenses is a great place to start. Here is a quick exercise to help.

Gather Your Supplies

For this exercise you should gather three months of credit card statements and bank statements. I am recommending three months because there may be expenses that don’t occur monthly, but rather every other, or quarterly. Next, grab some paper, your favorite pen or pencil, and two different colored highlighters or pens.

Note: I am still a big believer in writing things down, so for this exercise my instructions are going to be geared toward that assumption, but you can adapt it to use online tools, spreadsheets, or whatever method makes you feel more comfortable.

Classify Your Expenses

Starting with your most recent monthly statements, using your highlighters, go through and highlight all NEEDS in one color, and WANTS in the other. Every item should be highlighted when you are finished. After you finish your most recent statements, go through the older statements and see if there are any expenses that are not represented.

NEEDS: Expenses that are necessary to live and work. These are expenses like housing, food, transportation, utilities (gas, electric and water), and insurance.

WANTS: These are the things that make your life more comfortable, fun, or add convenience. These expenses are things like gym memberships, Netflix, travel, house cleaner, etc.

If you are like most people, you probably have a lot more wants highlighted.

Make a List

The next step is to list out the expenses in a way that creates a clear visual of where the money is going. Take your paper and make three columns – Need, Want, and Nice to Have. You can also download my expense cutting worksheet to use for this part of the exercise.

NICE TO HAVE: After all the needs are met, these are the first things that you would like to have with any money that is not going specifically to needs. This list will be different for everyone, but for me this is where you would find things like Netflix, or Audible.

I get that it’s very easy to say that all of your wants can go in the nice to have list, but since we are doing this exercise to make some hard decisions about where we can make some cuts…think about the few things that rise to the top in terms of your priorities.

Make the Necessary Changes

You now have a great list that gives you a place to start. For the items that didn’t make the nice to have list, take the steps to cut these expenses. This may involve calling and cancelling the monthly massage payment, or cancelling a streaming service for TV or music. You may even have a few things on auto pay that you aren’t really using. For things that can’t be cancelled, you need to reevaluate their place in your financial life. If you have a lot of dining out or take out charges, maybe that becomes “take-out one time a week” on your nice to have list.

While this exercise is not a replacement for an actual budget, it’s a way to easily see where your money is going. If you do have an actual budget, this will help to trim the budget as needed. If you want to put together an actual budget, this gives you a great foundation to start.

Published by Jenn DePauw - Organized Priorities

Jenn is the owner of Organized Priorities, a Colorado-based company specializing in Organization, Productivity, and Operations. As an organization and productivity professional, Jenn specializes in individual and team productivity coaching as well as organization for both individuals and small businesses. She is also the author of The Organized Priorities Blog (, an organization and lifestyle blog that focuses on making life more organized, more productive, and a little easier. For helpful tips on everything from weekly planning to home organization, and daily celebrations to words of encouragement you can follow @organizedpriorities on Instagram.

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