What's your average monthly expense? Most people guess

"What's your average monthly #expense?"
Whenever I ask this question, most people pause.
Then comes an answer like: "Maybe ₹80,000... give or take ₹20,000."!

In other words...They're guessing!

The next question is almost always:
"Can you suggest the best app to track expenses?"

Ironically, I rarely recommend one.

Not because expense tracking is bad.
Because most people start at the wrong place.
They begin by tracking every transaction.
This only results in more anxiety and confusion!

And after a few months, most start feeling tracking every transaction is a mammoth task!

To the countary, I suggest a simplified, easy alternative.
Open a separate Expense Bank Account.
Every month, transfer the amount you believe your expenses will be.
Use this account for everything:
UPI, Credit card payments, EMIs, Groceries, Shopping, any other expense!

After 5-6 months, you'll have a more appropriate answer.

Not because you tracked every rupee.
Because your bank balance did it for you.

If money is consistently left over...
Your estimate was high.
If you're transferring money every month...
Your estimate was low.

Now ask yourself:
"Am I comfortable spending this much every month?"

If the answer is yes...
Stop.
You don't need to optimize your coffee expenses.
There are much bigger financial decisions that deserve your attention.

If the answer is no...
Only then start tracking individual categories.
Now you have a purpose.

Don't start by tracking transactions.
Start by understanding what your life costs!

That's the number every financial decision is built upon.

MoneyMinusNoise:
We often measure investment returns to the second decimal place, yet have no idea what our own monthly living costs are. Clarity beats complexity.
If you're looking for help with managing your financials, feel free to reach out!

Can you tell your average monthly expenses with confidence?
If not, that's probably the first financial metric worth figuring out.