Financial technology has made it easier than ever to stay on top of your money. Credit card and utility bills evaporate from your account automatically, artificial intelligence-based algorithms tell you how to invest and online dashboards provide a holistic view of your net worth across all of your accounts.
But if you're looking to get your budget under control, you may be better off keeping things analog, says Alaina Fingal, a financial coach and founder of The Organized Money.
"I show people how to save, budget and build wealth by organizing their life, and my main tool is paper planning," she says.
The act of writing things down allows Fingal's clients to retain more financial information and helps keep their money priorities top-of-mind, she says. "When they're able to write down their numbers and see it in real time — actually budget on paper — it resonates with them a little bit more. And they're actually able to stick with their budget."
Here's why Fingal says that when it comes to getting your money in order, the pen is mightier than the smartphone.
A notebook creates 'friction' against impulse spending
Fingal doesn't expect you to conduct your entire financial life with a pen and paper. She's a fan of automatic bill pay, credit card points and, yes, even a digital budget.
Fingal recommends having a plan for where every dollar in your budget goes, often urging clients to make spending plans for upcoming paydays. She also recommends setting aside cash envelopes for certain spending and savings categories if clients tend to struggle with overspending.
But once you have a bird's eye view of your monthly spending, you'd be wise to start carrying a small notebook, Fingal says.
"When it comes to the day-to-day, most people don't walk around looking at their spreadsheets. That's when I tell them to switch to a manual system," she says. "Just take little notes about what's happening throughout the day so you have something to look at, at the end of the day, to compare to your budget."
Under Fingal's system, you might make note of your food budget before a trip to the grocery store and do a little subtraction when you check out.
This small ritual has a twofold effect. For one, Fingal says, "we're usually not keeping track every time we swipe a card. This way, you keep track of what that number actually is."
Plus, the act of writing out expenses can help you trim costs made out of convenience or impulse that tend to derail your spending plan.
"It allows you to have a little emotional interaction with it. It causes that additional friction that a lot of times we need to stop impulse shopping," Fingal says. "Just writing it down makes us stop and say, 'Oh, wait. I'm getting close to by budget number. Do I really need this Uber right now?'"
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