How I manage my Personal Finance using Notion
Ever since I was introduced to Notion, I started using it for almost everything. It had been my productivity booster, Goal Tracker, Workday Planner, Calendar, My Blog Workspace, To-Do, Education Planner, etc. By end of 2020, I thought, Why not try personal Finance using Notion?
Over a long time, I have never been able to manage my finance and I was struggling with overspending issues. Sometimes, the credit card bill used to be larger than what I earn. When I break down the credit card bill, there would be a lot of Wants than Needs.
2001,
Back in the days, My dad used to maintain an accounts notebook where he would track every single expense and mark them as necessary or unnecessary. By the end of each month, he would sit with the family and share the unnecessary expenses done that month. By this, we were able to understand that we shouldn’t be spending on unnecessary stuff. The amount spent on unnecessary expenses in the current month would be deducted from the next month’s pocket money. We wanted to control the unnecessary expenses from our name and therefore, just before buying anything we used to question ourselves if this purchase would be in the unnecessary bucket of Dad’s account notebook.
With this practice, we were able to cut short our expenses, and also, as a Kid, I had developed a habit of Savings. Every month, I used to have a Savings of about 250–500 Rupees back in the early 2000s. Now that by 2020, I started to struggle with finances, I thought why not practice the same technique which my family used to do back in the days. Obviously, I can practice the same technique using a notebook but when we have notion which can act as a canvas to replicate the same practice digitally? Why not try the same with Notion?
Here’s how I built the simple table in Notion, that helps me with tracking Finance..
Requirement:
- When is the Expense?
- What is the Expense?
- Why is the Expense?
- What is the Reason for the Expense?
- What is the source of Money.
- What is the opportunity for Savings.
- What should be the actual expense?
Goal:
The Wants should be 0.5x compared to Needs.
The Template:
After trying multiple templates, I arrived at the above template which helps me understand.,
- My total Expense
- My Expenses on Need and Want
- Major source of Expense
- Major Expense Category
Breaking down the table.,
When is the Expense?
The first column can be used to record date of the expense. Tracking dates, would really help to find trends or seasonality in terms of spending.
What is the Expense?
The Second column is used for recording any text to denote the expense. This can be later referred if some justification/explanation is needed for the expense.
Why is the Expense?
The fourth column is used for primary categorization ie., Need/Want. This column primarily solves the question. How much I have spend on Wants?
The purpose of this column is to control the wants. Also, to eliminate the repetition of same purchase in Wants category. Example: If I have spent money on a media subscription say Netflix., I shouldn’t be spending another couple 100s with Amazon Prime. Simple!
What is the reason for the Expense?
The fifth column is used for secondary categorization of the expenses despite of the fact that it is a Need or a Want. Here I can mark transaction between several category such as Household/Subs/ Purchases/Education/Beauty Products etc. Helpful in deep diving the expenses by category.
What is the source of Money?
The sixth column helps with marking the source of expense. This helps in understanding how much money is spent from the salar or credit card or wife’s salary etc.
What is the opportunity for Savings?
The seventh column Opportunity helps with marking the expenses that could have been avoided. This is the amount that I should be cutting down from the next month. According to this table, I have to save 15000 from the salary before starting next month’s expenses.
What should be the actual expense?
The last column is the ultimate answer to what should have been my optimal expense considering all the needs are fulfilled. Seeing the table, I can understand that I would have needed only 10000 however additional 15000 have been spent on wants. This is 1.5x times the needs. Now the goal should be reducing the wants under 0.5x the Needs.
By the end of Month.,
All I have to do is export the table as csv and prepare few pivot charts to understand how my finances were throughout the month.
Prepares sample charts below:
With the four charts., I am able to understand that.,
I was negligent when spending for Celebration at Home.
The Celebration expenses of about 14000 was made through credit card on 11th Jan which is a Want and a BIG NO!. Next time, there is a celebration, I should plan in advance and have sufficient savings without having an expense from credit card.
Using this tracker, I am trying to control expenses and start saving.
You can find my notion template here and click Duplicate to use it.
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