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If you decide to start keeping personal finance records


I talk about the importance of keeping personal finance records and budgeting in my consultations all the time. From many I hear various excuses. But some still decide to start. Choosing an accounting method is one of the first decisions you must make at this stage.

There are only 3 ways to keep track of personal finances. All the rest are derivatives of the main ones. Next, I will discuss the advantages and disadvantages of each.

Paper method of accounting

The oldest way. Available to everyone. I wrote down my expenses in high school.

If you decide to start keeping personal finance records

A notepad is the perfect helper to start keeping track of finances for kids


+ Easy to get started. A diary presented for the New Year is suitable. Opened and started.

+ Unlimited customization options. Any font, any color and drawings on the margins.

+ A good simulator for oral counting.


Unreliability. Manuscripts still burn, deteriorate and get lost.

“There is practically no possibility of data analysis. The maximum can be calculated sums and deviations. At a huge time cost.

Virtually useless for accounting, investments, currency transactions, debt transactions and with more than one wallet and a large number of expense categories.

Who will suit?

Children to learn about personal finance management. Accounting for pocket money and piggy bank.

Computer-manual method of accounting

The method is based on fixing operations in spreadsheets. 99.9% of these spreadsheets is an Excel program

If you decide to start keeping personal finance records

Excel spreadsheets can be a handy tool for simple accounting and budgeting


+ Ability to quickly calculate totals, deviations and shares.

+ Ability to account for multiple wallets, categories of income and expenses.

+ With proper knowledge of Excel, you can very flexibly customize it for yourself and specific tasks.


Requires knowledge of formulas and formatting to get a more powerful tool than a blank chart with totals.

It takes a lot of willpower to constantly fix operations at a certain time, since the tool is not mobile. (You can, of course, implement it through google docs and forms, but this greatly complicates the process.

Just like manuscripts, the file can be damaged (you can solve it with backups, but it’s time consuming).

When making changes to the accounting principle (changing categories, transaction labels, etc.), it is laborious to make changes in past periods.

Who will suit?

For daily accounting for scrupulous and consistent users with 1-2 ruble wallets, clearly defined categories of income and expenses.

It works best on a short-term project, such as an event or travel budget.

Fully or partially automated accounting method

The most modern way, based on the use of applications or services.

If you decide to start keeping personal finance records

Accounting in applications and the cloud requires the least effort on your part and has the highest accuracy

Third-party applications are special programs for a computer or phone, which are specially designed to solve the problem of accounting for finances, maintaining home accounting.

Recently, banking services allow you to take into account finances in the background. When paying for goods, the bank understands where you made the payment and assigns it a certain category. Manual entry of operations is reduced to a minimum.


+ Sharpening for tasks greatly simplifies the process.

+ Synchronization between devices or users. You can take into account on your smartphone and computer, as well as in parallel, for example, with your wife. Keep in mind that both of you must meticulously keep records, otherwise a fly in the ointment in your family barrel of honey.

+ Accounting for a large number of wallets, currencies and exchange rates ensures high accuracy of data at any time


Mistakes still happen. For example, your bank labeled your purchase at Magnet, Dixy, or Perekrestok as a grocery expense, but what you actually bought was shampoo, mosquito repellent, and knives. You will have to change the categories manually for greater accuracy.

It is impossible to completely abandon manual operations, since cash expenses are still in our lives (apparently, they will be for a long time).

Not all services can be connected in an automated mode. For example, balances on exchange accounts or IIS need to be adjusted manually.

Who will suit?

Applications for almost everyone for daily accounting. Banking services are ideal if you do not pay in cash, you have one bank card or several but in the same bank. (In the following articles, why this is not too good).

This is the method I use on a daily basis. I will talk about specific applications and services in the following posts.


Different ways of accounting for finances are suitable for different life situations. If you decide to seriously take on your budget, then I recommend applications with advanced settings and features. For an event or trip budget, Excel is a great tool. If you want to teach children about accounting, give them a beautiful notebook that they will want to look into and write.

Post source: zen.yandex.ru

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