How a £2 investment saved me a staggering amount of cash

So there’s this guy, Lord Kelvin, whose work helped define both the first and second law of thermodynamics. He was such an intellectual badass they named absolute temperatures after him (hence kelvins). He also did some incredible things for data transference, but I digress. Lord Kelvin said this amazing thing:

He also said “if it ain’t big enough, give up” but that’s not nearly as inspirational is it? Image Credit: Quotesgram

Where does all your money go?

notebook, wealth, success
Behold! Tis thy saviour of wallets, thy destroyer of debt, thy breaker of bad habits!

With this quote in the forefront of my mind I went out and invested £2.05 into a pen and a pocket book, and for the past month I’ve been recording every purchase I make. Every. Single. One.

In an effort to improve my saving ability and worsen my spending ability I figured that I’d need to measure exactly how much I spend each day. This is because the act of measuring gives me an actual number to aim for, instead of “I’ll spend less this week”, I can actually say “I’ll reduce my spending from £200 a week to £150”.

By tracking what you spend your money on it’s far easier to look at purchases that can be avoided. I’m currently living in Korea and Korea has an amazing selection of teas for sale at every convenience shop (of which there are hundreds), so most days I walk in, whip out my debit card, and spend 2,000 won (roughly £1) on delicious tea.

Do I need to buy tea everyday? No, of course not, so I stopped. Obviously saving £1 a day isn’t that much, but if you want to cut your weekly expenses from £200 to £150 you’ve already saved £7 (or nearly 20 per cent of your goal).  Extrapolate this into your own life; how often do you go to Starbucks, McDonalds, or make impulsive purchases?

“It’s only £x” is what a few of my friends have said to me back home, but the point is that it’s “£x” that you’ve spent meaninglessly. But it’s those small amounts that we carelessly throw away that can put a significant dent to how much we can save each month.

Each time I purchase something I take my pocket book out of my back pocket and write down what I bought and how much it was. Now I’m sure you’re thinking…

“This sounds like a lot of hassle”

wealth, personal finance, saving
Spending money is like taking candy from a baby, expect you’re the baby Image Credit: Nisha A

You’d be 100 per cent correct, it is a lot of hassle (at least at first). It was super annoying having to take out the book whenever I bought something, but that’s the point.

If I want to buy something I don’t need cash, I don’t need a signature, I don’t even need a PIN! It’s such an easy motion to swipe my wallet across the payment terminal, which is exactly why I needed a way to make it more difficult for myself. In that extra few seconds it takes for me to also pull out my little green book, I’ve turned what used to be a thoughtless action into one that actually makes me think “do I need this?”

I’ve actually tried to do this sort of thing before using a number of different apps. On paper (HAR HAR), it’s a much better system, many of the apps allow you to export your expenditures to spreadsheet software, track budgets, and provide sexy graphs to gawk over… but none of them stuck.

I’d find that instead of putting the purchase into my phone I’d get distracted by unread text messages, Facebook updates, or my word of the day. My head is already full of psychological connections with the physical act of pulling out my phone that I needed something that would only be associated with spending.

How do I start?

coin, wealth, personal finance
All you need for this investment Image Credit: The Royal Mint

Right, first things first, I suggest you don’t go for the cheapest pocket book you can find. Find one that feels good to use, one that is pleasant to write on, and make sure it fits in your pocket! Repeat steps to find suitable pen. It’s important to use equipment that you’ll enjoy using as you’ll be carrying this with you at all times.

Next, don’t make any changes to your spending habits, just make sure you record all your purchases. Do a week of this to get used to the act of pulling out your notebook each time you buy something. You are also setting a bench mark of your currently weekly expenditure.

When the week’s over, look at your total spent. Are you happy with the amount? If “yes” then I’m sorry to have wasted your time. If “no” start looking through the purchases for things that you don’t really need, things like; treats, coffees, things that you don’t even remember buying. Set a goal like “Next week I will reduce my spending from £x to £x”.

As you look over the past week, look for ways to help you hit that goal.

For those of you who don’t think you can change your spending habits that drastically, look how to save £1 a day, and then next week put those thoughts into practice. Then as you look over your expenses the next week, look for ways to save £2 a day, and keep doing that till you’re happy with the amount you’re saving each week.

The pen is mightier than the debit card

wealth, spending, personal finance
The 6/10/15 shall hence forth be known as “the day I managed not to spend ANYTHING” or the catchier title of TDIMNTSA

The purpose of this habit is to both help you save, and help you be more mindful about what you spend your money on. I’ve actually begun to really enjoy trying to beat my all time high  low score, and trying to figure out how I can get by for less. The other day I didn’t spend anything… which sadly impressed nobody, but I felt great!

I’m also enjoying the things I do buy even more, because getting the occasional tea, burger, or coffee isn’t something I just randomly happen to do, I choose to do it. I’m also spending more time in the kitchen looking for ways to produce tastier food for a packed lunch, my girlfriend and I have started hiking for fun, and I now know exactly how much money I have.

The strange thing about this is, I can actually buy more.

Due to me saving an extra £50 a week by cutting out extraneous expenses I can now afford to buy higher quality goods, that will last far longer than cheaper, more disposable goods.

Here’s a recap of the steps:

  1. Buy a pen and notepad that you enjoy using, and that fits in your pocket
  2. Don’t change anything, keep spending what you normally would, and write down every single purchase you make
  3. At the end of the week review your spending and set a spending goal “Next week I will reduce my spending from £x to £x”
  4. Repeat step 3

One final point

Although this article is focused on spending, you can actually use this technique for anything you want to improve in your life.

Want to improve your diet? Track what you eat each day, and at the end of the week look at the foods you could either not eat, or replace with a healthier option (Hint: snacks and soft drinks you can remove entirely).

Want to exercise more? Track your actions, and look for ways to get more movement in your daily schedule (such as taking the stairs, or going for a walk during your lunch break).

What other aspects of your life could you improve using this technique? Let us know in the comments.

Saved a load of cash and don’t know what to do with it? Check out 5 things every rookie needs to know about stocks, shares, and bonds.

Want some more tips about how to create wealth? Read The 3 things you absolutely need to know about becoming wealthy

For some more examples of money diaries here’s one, and here’s another one

Image Credit: A Cheerful Living



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  1. This advice is sound. I have practiced this technique for many year with significant degree of success, despite several long periods of neglect. Now after reading article I am inspired to begin anew and re-evaluate my life. Thank you for this.

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