When you’re creating a budget and tracking expenses, remember to look at the big picture as well as the details. Grouping expenses together and looking at the total for each category helps. Think of your total income as a pie, with each category being a slice taken out.
For example, do you really want to spend 20% of your income on entertainment if that leaves only a 2% sliver to save for your future?
Grouping your expenses as categories helps you make sure that your spending habits match your priorities and are helping you to reach your financial goals.
It’s easy to see how your spending is grouped with the Personal Cash Flow Calculator. It automatically generates a pie chart of how your income is sliced up, so you can really see the big picture.