So, why is it so difficult to track your cash flow? Business Week reported that the average American family now spends more than it earns, while average credit card debt has risen to over $9,200. Americans have become trapped in super-consumerism by following the patterns set by our Nation's large lending institutions. Just a few of the factors that make it so hard to track your cash flow include: impulse buying, living in a nearly cash-less society, C.I.A. (convenience, indulgence, appearance) and the media.

The only way to track the movement of anything is to watch it, and record what happens, so that you can analyze what you have just watched. Tracking and understanding the movement of your cash flow is no different, and the simple solution is to develop a tracking system. I recommend that you track ALL of your expenses for at least one month with either a spending journal or by collecting receipts.

To begin, collect all of your credit card statements, bank statements, cancelled checks and receipts, and then divide them into piles. For example, if you spent money on your children for basketball or piano lessons, that would go into one pile. Any money spent at the grocery store would go into another pile. Anything spent on gasoline or automobile expenses would go into still another, and before long you have all of your checks divided into their appropriate piles. These piles now become your spending categories. This is a significant process and should not be taken lightly. There are several lessons to be learned with this exercise that you may not fully appreciate. When you select a check to determine the appropriate category, you examine where you really spent that money and will many times say to yourself ?Why did I do that,? ?that was a waste of money,? ?I shouldn't have done that.? We want you to experience this emotional event. We call it spender's remorse and it will help you re-prioritize your spending and we hope teach you how to create a tremendous amount of savings.