What is tracking?
Tracking income and expenses means keeping a written record of how much money came in and where it all went over a set period, usually a month. Salary, business income, tuition fees, remittances are all income; groceries, rent, transport, mobile top-ups, tea and snacks are all spending.
This is not a budget. A budget is a plan for what comes next; tracking is an honest picture of what has already happened. To build a good budget, you first need to know where your money goes now.
Say Rakib has two cups of tea and a snack near his office every day, costing Tk 80. Day by day it feels like nothing. But over 30 days that is Tk 2,400 a month, nearly Tk 29,000 a year. The spending isn’t wrong; the problem is that without tracking, Rakib would never have known it was that large. The numbers are only an example.
Why it matters to an investor
- Money to invest comes from the surplus: what is left after spending is the source of all saving and investing. Without knowing the surplus, you can’t plan.
- To size an emergency fund: saving “six months of expenses” means first knowing what one month actually costs.
- To understand your own inflation: knowing your spending basket shows how much rising prices are really hitting you.
- To decide under pressure: if income falls or a job is lost, you already know which costs can be cut.
How to start
- Pick a tool: a notebook, a phone note, a spreadsheet or an expense app. The best one is the one you will actually use every day.
- Write down each day’s spending the same day, two minutes before bed. Trying to remember at month-end is almost always incomplete.
- Check against your bank and mobile wallet statements. Digital payments leave their own record; only cash spending needs writing down separately.
- Keep going for at least two or three months. One month with Eid, a wedding or a medical bill can distort the picture.
How to group your spending
Put your spending into a few groups. Fixed costs are roughly the same every month: rent, school fees, loan instalments, money sent home. Variable costs move around: groceries, utilities, transport, eating out. Irregular costs come once or twice a year: Eid shopping, admission fees, insurance premiums.
Irregular costs are often left out of monthly tracking, and that is when sudden shortfalls happen. Dividing the year’s irregular costs by 12 and counting that every month gives an honest picture.
Where the average Bangladeshi household’s money goes
According to the BBS Household Income and Expenditure Survey (HIES) 2022, the average household earned Tk 32,422 a month and spent Tk 31,500. The biggest share went on food, about Tk 13,200 a month or roughly 42% of spending. Next came housing and utilities (about Tk 4,400), health (about Tk 2,100) and clothing (about Tk 2,100).
These are averages; the picture varies a lot between city and village, income levels and family sizes. You can compare your own numbers with them, but the aim is not to match the average, it is to know where your own money goes.
Source: BBS, Household Income and Expenditure Survey 2022 (Prothom Alo English and The Daily Star, December 2023)
See the numbers as a table
| Monthly spending | |
|---|---|
| Food | Tk 13,193 |
| Everything else | Tk 9,711 |
| Housing and utilities | Tk 4,418 |
| Health | Tk 2,115 |
| Clothing | Tk 2,063 |
Worked example
- Say your monthly income is Tk 40,000. You believe about Tk 8,000 is left at month-end.
- You list the big costs: rent 12,000, groceries 9,000, money home 4,000, transport 3,000, utilities and internet 3,000. Total: Tk 31,000.
- For one month you also write down the small things: tea and snacks 2,400, food delivery 2,800, subscriptions and extra data 800. Total: Tk 6,000.
- Total spending: Tk 37,000. What is actually left is Tk 3,000, Tk 5,000 less than you thought.
Result: the “missing” money wasn’t in the big costs but in the small ones. Which to keep and which to trim is your call; but now it is an informed one. The numbers are only an example.
Common mistakes
- Recording only the big costs. Small daily spending often adds up to the largest amount.
- Leaving once-a-year costs like Eid, admissions or insurance out of the monthly picture.
- Setting strict rules in the first month and then giving up. The first job is only to observe, not to judge.
- Tracking only your own spending and leaving out shared household costs or money paid on others’ behalf. You need the whole household picture.
Budgeting, saving and investing all start with one question: where does my money actually go? Two or three months of honest records will tell you.