Professional Documents
Culture Documents
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Receipts
For most people, living paycheck to paycheck is already becoming quite a natural phenomenon. We’re encouraged by
giant billboards, repetitive TV advertisements and trendy printed publications to shop, buy, and spend on products
and services we hardly ever need. We are also taught to spend so that the economy will flourish and boom, even if it’s
on the expense of our very own ‘personal economy’!
With all these marketing messages going through our five senses on a daily basis, it’s a good idea to step back and
look at how these mass media propaganda is influencing our spending habits and ultimately, our lifestyle. It’s time to
do a reality check and ask ourselves where all the money went. We might not be as strong as we thought when it
comes to controlling our spending desires.
For most of us, we start off the month usually with with a four (or even five) figure in our account, and before the
month draws to an end, the figure would just 'magically' evaporate.
If this sounds familiar to you, you are not alone. During the course of my work, many people I’ve interviewed seem to
be plagued by this ‘money evaporating magically by the end of the month’ syndrome. From my findings, this
syndrome does not discriminate between highly paid managers or even fresh grad executives who are just receiving
their first paycheck.
I’ve always believe that to solve a problem, you need to first diagnose the root of the problem. Just like Chinese
medicines, the remedy does not attempt to relieve the symptoms. Instead, it goes direct to the root of the ailment and
attempts to get rid of it once and for all.
Back to the issue of the money evaporating syndrome ‐ we already know the symptom: we are nearly broke by the
end of the month. Sometimes, we don’t just go broke. To add salt to injury, we sometimes swipe away more than we
can chew with our ‘prestigious’ credit cards.
We have to stop denying the fact that we are spending more than we should and accept the fact that we have a finite
amount of income, and an infinite amount of spending desire. Now, we have the diagnosis to our ‘illness’ ‐ Spending
infinitely when our earnings are finite.
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Receipts
So, after accepting that the money did not magically evaporate and that we are fully responsible to this syndrome, our
next step is to find out where all these money went? Yes, we must track them down like we track a criminal’s trail. But
fortunately for many of us, you don’t have to possess the knowledge of Sherlock Holmes to identify the ‘crooks’ since
the evidence is actually quite obvious.
The most direct evidence of where the money went is through paper receipts. So, if you do not have the habit of
keeping those receipts each time after you’ve made payment, perhaps it is time that you start to look into this
evidence gathering activity.
Keep the Change, But Give Me the Receipt!
Many people I’ve known do not like to keep receipts because they have no idea what to do with it, and that it’s a
troublesome thing to administrate another set of paperwork. And for those who do keep track, a majority of them
keep track on a ‘yearly’ basis for taxation purposes, which means they only know about their expenditure adventures
one year after they’ve spent the money.
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Receipts
In my opinion, you do not need to keep track of your expenditure on a daily basis. This would be too time‐consuming
and not practical. Ideally, receipts should be consolidated at least once a month. In the following step‐by‐step guide, I
would share with you how you can start organizing your receipts and be in control of your own spending.
1) First, get yourself a few A4 sized envelopes, since some receipts might come in A4‐size. I have yet to receive any
receipts in A3 yet.
2) This is likely your first time doing this, so my advise is that you do not label these envelopes just yet. Collect all the
receipts for the month in a single envelope first.
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Receipts
3) Next, just go about your daily routine, but always remind yourself to keep the receipts after each purchases,
especially the big ticket ones (an RM5,000 Mountain Bike) and purchases with the highest frequency (food and
beverages).
4) Once the month ended, take out all the receipts that you have collected and spend some time sorting them
according to the most relevant category. Do not worry about creating categories that would become redundant later.
You can always add new categories later on. The key to creating good Receipt Category is to think of how you would
review your expenditure later.
For example, when I first started this exercise, I categorized all my utility bills which included my mobile phone
expenses, my fixed‐line expenses, my broadband expenses, and my electricity expenses under a single category ‐
Utilities. A few months later when I refer to the Utilities record, I had no idea how much exactly I’ve spent on my
mobile phone! And that’s when I realize that I should break it down a step further to:
1) Broadband bills
2) Mobile Phone bills
3) Electricity bills
4) Fixed‐line bills
A word of caution: You might not want to break it down into too many categories as it might become an
administrative nightmare which would later cause you to stop the entire exercise altogether.
A bad example would be having a different category (with a corresponding envelope) for every different petrol station
you pump your petrol, since you won’t need to know which petrol station you frequented most. The idea is to be
flexible yet definitive.
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Receipts
4) Fire up your spreadsheet application. We are not going to get very technical with the spreadsheet. You just need to
know how to create simple formulas. Here is a sample of the spreadsheet.
Jan Feb Mar Apr
Utilities ‐ Water $43.83
Utilities ‐ Electricity $156.98
Utilities ‐ Phone Line $89.28
Utilities ‐ Mobile Phone $150.29
Car Installment $1,350.00
Parking $89.00
Tolls $98.10
Petrol $539.95
Car Maintenance $210.40
Traveling $493.10
Food & Beverages $593.92
Medical & Healthcare $0.00
Stationeries $80.19
Entertainment $328.84
Books $88.38
Groceries $388.93
Insurance $493.01
Charity $0.00
Total $5,194.20
I have included a few categories in this spreadsheet that you would most likely have. Feel free to copy and modify it
for your own personal use.
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Receipts
From now on, we will refer to this spreadsheet in this guide as ‘My Expenditure Journal’. To view the sample
spreadsheet online, you can go to this link:
http://spreadsheets.google.com/pub?key=t8lfWDEY5‐BAm84N5_O8cBg&single=true&gid=0&output=html
5) It is important that the categories listed in your spreadsheet correspond to the labels you write on your envelope.
Label it with a black marker pen, in ‘bold’ so that it’s easy for you to sort and read them later on.
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Receipts
6) Once that’s done, you should put all the receipts of the same month in their respective envelopes. Make sure you
do not leave any receipts out. It is still fine to bring a few misplaced receipts to the coming month, but it’s not
recommended, especially if the sum is significant.
7) Next, start summing up the receipts for each of the categories. I would suggest you use the spreadsheet to do this.
You can use a calculator to do this, but if you are distracted mid‐way, it would be difficult to track back to your
previous entry. So, use a separate blank spreadsheet, and sum up the categories one by one.
8) Once you have the total amount for one category, copy and paste that amount into ‘My Expenditure Journal’.
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Receipts
9) Proceed to sum up all the receipts according to its category until all categories have been totaled up and inserted
into ‘My Expenditure Journal’.
10) Instead of throwing the receipts back into their respective envelopes, I use a cardboard to label the receipts
according to their categories and clipped the receipts and the cardboard label together with a paper clip. This might
sound like an extra step, but I find it easier to file the receipts without the envelopes.
11) Next comes the real physical task, which I think is the step that is most time consuming and requires the most
discipline ‐ filing the receipts. If you already have your own way of filing receipts, and if you think it has so far been
very effective for you, then by all means stick with it. Here in this guide, I am going to propose my way of filing these
papers.
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Receipts
i) First, paste these non‐standard sized papers onto A4‐sized papers according to their categories. Label these
categories so that you can refer back to them later. Use recycled papers whenever possible.
ii) If some of these receipts are already in A4‐size, then just filed them without pasting them.
12) Do this every month, without fail. In my experience, it is sometimes tempting to delay the consolidation of
receipts for a few months, but as long as the collective receipts are grouped in their monthly order, it shouldn’t be too
difficult to consolidate them later on. However, my suggestion is that you should clear up these receipts and file them
within 4 to 5 days after the month ended. It is really a matter of habit.
About the Author
Yow Chuan is an AFPM with the Financial Planning Association
of Malaysia.
He can be contacted via his e‐mail yowchuan@meshio.com or you can view his latest personal finance articles at his
blog www.meshio.com