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They say what you measure improves…

Over the years we have all heard the saying what you measure improves. Without question I have found that to be true in business. Today’s question is does that apply to your personal life.

I actually tested that question. I figured out what my average monthly American Express bill had been over the past 12 months. Let’s not debate how many of those dollars are wasted but rather what would happen if I logged onto my account every day and saw the balance and transactions from the day prior.

The rules I set for myself was no game playing. Meaning, if I normally charged an expense to this card I would continue to do it, I wouldn’t use a different credit card. I also said not to change any behavior meaning just pay cash instead. That would not make the test valid and I was really curious on what would happen.

Daily I checked my balance and transactions and at the end of the month I actually had a bill which was half of what I normally spend. I must admit I was shocked. It is possible that July/August I spend less than normal and although that is true it isn’t even close to this new lower balance. I also looked to see if I traveled less and at the end of the day it was about the same.

In discussing this with my buddy (R.H.) he brought up a great point which is… what categories did I save in? I couldn’t answer that question right away and decided to keep the test up for two more months and see if there was savings and what categories they fell in.

So I ask you?

  • How closely do you keep track of your expenses?
  • Have you tried a similar test for yourself?
  • If not, what do you think might happen if you did?

I look forward to hearing from you and reporting back in two months.

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