Anyone who wants to pursue early retirement or grow their passive income through saving and investing tracking your spending is a must. This way, once you’ve set your realistic budget ( I always see people set unrealistic budgets, unrealistic budgets have no real value as you will always fail), you can track where in your budget you are overspending. Giving you a better focus on where your money is going.
Tracking your Spending
I’ve been tracking my spending for years now. 6 years to be exact. I have a spreadsheet that is a few 100 megabytes. And with several tens of tabs, it’s getting a bit unwieldy. Tabs full of graphs and charts. Once a month, like clockwork, I would sit down and download all my transnational data from my bank and several investment services.
The process of organising my transnational data would take me a few hours. Painstakingly go back and figure out what each transaction in my account was for and categorize it into a total. This worked for me for many years.
However, I never did anything with the data. Sure I had a budget and some Excel rules to show me which area of my spending was too high. But I just looked at it and shrugged it off. Oh well, I will spend less next month, is what I would tell myself.
Growing Networth
The whole exercise was more to see how my net worth was growing. And how far away I was from my target amount to be able to retire and live off the passive income. I didn’t really look into the details of my spending.
That needs to change. And one way I am going to change is to update my blog on my monthly spending and set some goals for myself. That way, they are out in the world, and I am somewhat held accountable for not achieving them.
Time to sit down and go through my transactions is also becoming harder to find. I thought it was time to move to a digital version of my spreadsheet. I did some research on a few different online services and analysed their pricing. After a while I found Pocketsmith!
Automated Budget Software In NZ
Knowing me, I signed up for their basic account, because it was free- I didn’t understand why I would pay for a budgeting service. It didn’t make any sense. So I started entering in my transactions into pocketsmith manually. Downloaded CSV files and uploaded them, then pocketsmith would ask me to categorise every single transaction.
The whole process was very similar to my spreadsheet. Except- all my data would be graphed and displayed far easier than my manual spreadsheet. They even have means of creating a realistic budget from analysing your previous spending- much better than estimating what you think your budget should be.
Networth Tracking
There is a tool to track your net worth as well! You input your investment assets and liabilities and pocketsmith will track and display your net worth on your dashboard. Your dashboard also shows you a pie chart of spending and income- customizable to any time period.
That is what is different between my spreadsheet and pocketsmith. I can search for the data far easier. I can search for the data far easier. I can go into each category and find out exactly each transaction. Whereas for my spreadsheet, I could sum each category and input a total.
The other neat thing is that you can link pocketsmith directly to your bank account. That way transactions are uploaded automatically. You can then make rules in pocketsmith, and it will categorise the spending automatically as well. And anything uncategorized waits for you to manually categories it. This saves me hours or manual data processing.
Free Software
Pocketsmith is free to use! You do have to pay for the premium plan to have automatic bank feeds active. But I think it is well worth it for $7.49 per month. Especially if you view your time as money and know your real hourly income rate!
Overall, Pocketsmith has been great! I would recommend anyone looking at getting into seriously going after passive income and early retirement to get a service like this. It does seem counterintuitive to pay for this service, but it automates budgeting and tracking your spending so well! And save you so much of your precious time.
Check them out, and let me know if you use an online budgeting service like Pocketsmith.

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