Imelda Popplewell has lived in Abu Dhabi for three years. And she admits that, until recently, she has treated her dirhams as if they were monopoly money. "I don't give it much thought," she says. "I just hand over the cash when I shop. For instance, the other day I bought my daughters a treat of pick-and-mix sweets, just a one-off for being good while we were out at Marina Mall. This cost me Dh40, which was way too much."
Mrs Popplewell, who lives in the capital with her husband, Andrew, and their two daughters, Katie, 3, and Amelie, 22 months, had for a while sought ways to keep a closer eye on her daily expenses. Her solution: starting a spending journal. "You just don't think about your expenditure when you don't keep a diary; it's a really useful tool," she explains. "Keeping a spending diary has really made me focus on my purchases and made me realise there were things I was spending way too much on."
In its simplest form, a spending diary maps your everyday expenditures, from your morning cab fare to work to the time you close your door, and indeed your wallet, for the night. The idea here is no exceptions or exclusions, but rather a full and frank disclosure of money and you. Generally, you should keep track of all your purchases for a month for it to prove a worthwhile exercise. Filled out correctly, a spending log will help you recognise your spending impulses and, in time, may rehabilitate your bank balance by clearly identifying the money you squander.
Armed with an insight into your behavioural patterns, you can start to break your bad fiscal habits. Alvin Hall, a financial expert and author of the book Spend Less, Live More, says keeping a 30-day diary once a year can be useful regardless of your financial circumstances. "It will usually reveal how the person's spending may have changed or how waste has silently crept into the ways you use your money," Mr Hall says. "People assume their money habits stay generally the same, but they do not.
"The periodic diary exercise can provide important insights that will help a person stay on a prudent financial path. The person can refine how he or she spends money, making better, more informed choices for both short-term and long-term happiness and fulfilment." Mrs Popplewell first began documenting her spending on October 1, and finished her record keeping on November 3. She then agreed to share her notes with The National so we could gain some insight into a busy mum's life, which revolves around taking her two daughters to playgroups and nursery.
But first things first. Surveying her sheets of handwritten data, Mrs Popplewell admits that "my coffee consumption must equal the GNP of a small country". It turns out, according to her diary, that her expenditure on a caffeine fix amounted to Dh13 a day over 34 days, or Dh395 per month and Dh4,745 every year. That would be the GNP of a very, very small country indeed, but it's a not insignificant figure nonetheless.
Her records reveal some occasional misadventures, too, including being unable to lay her hands on the family's Daman health cards (twice) while on her way to the pharmacy to buy medicine for her children. That oversight meant Ms Popplewell had to pay Dh210 for medication that might otherwise have cost nothing. Another time, Mrs Popplewell locked herself out of the family apartment. "I left the keys in the lock and closed the door," she remembers. "I had another key on me, but couldn't get back in, so I had to get somebody out to take the door off."
The price of her lockout was, thankfully, a relatively skinny Dh40. Such experiences are routine moments in family life, when there is often little time for fiscal prudence in the hurly-burly of the moment. But, says Ms Popplewell, "the key to keeping a spending diary is to decipher it. Set some time aside and look at your patterns". Her diary also reveals a relatively small spend during the month of Dh400 on filling the family Toyota Land Cruiser Prado up with fuel, a monthly splash of Dh272 on dry cleaning and Dh200 on mobile phone credits.
In addition, she spent a total of Dh2,545 at the supermarket, although some of the family's food shopping is done at the weekend, when her husband uses his cash to buy groceries. As such, any food purchased on Saturday did not make it into the diary. There's also Dh690 spent on babysitters (which most parents will tell you is worth every penny) and a purchase of £250 (Dh1,520) made online at JohnLewis.com, the internet home of the popular British retailer. As this transaction was made in another currency, it was effectively taken off the books and has not been included in the final tally.
In all, the diary records an expenditure of Dh17,937, or Dh527 a day, to keep the family ticking. So would she recommend the spending diary exercise to others? "You should definitely try one just to see where your money goes," Mrs Popplewell says. "I thought at the beginning that I didn't spend much. I guessed that I'd work my way through Dh100 a day. It's not really that at all. Generally, it's a lot higher than that."
Equipped with data from her diary, Mrs Popplewell says she has a better understanding of her fiscal impulses and is now looking at ways to reduce her daily budget. Analysing the charts of her outlays, it seems obvious that there is some one-off expenditure on birthday presents for friends (Dh1,135) that should vary wildly month to month, and the family hairdresser saw some brisk business during the month, as both mother and daughters prepared to have their picture taken for this article.
On the flip side, just one magazine (Dh10) and one DVD purchase of Dh40 show fiscal prudence. "Keeping the diary has helped me look at ways to save money," Ms Popplewell explains. "I wanted to join the gym, but I had to stop and think about whether I would have time to go and whether I would be committed to going. So now I've found a pay-as-you-go gym, which just happens to be very close to where I live." The net result is just Dh30 spent on two fitness sessions during a month - definitely no wasted cash here.
"I also realise I spend an awful lot on lunch and I've thought about how I can reduce this," she says. "So maybe sometimes I'll take the girls for a picnic in the summer months, instead of paying for lunch at the mall." A look at the diary shows Dh2,410 was spent on eating out over the period. Mrs Popplewell also says she was surprised that she spent Dh209 on an impulse trip to Daiso, the Abu Dhabi branch of a well-known Japanese discount store, to stock up on Halloween goods for the girls. It is exactly this sort of insight that will influence her future finances.
Ms Popplewell has resolved to continue tracking her spending and may start using a spreadsheet to record the ups and downs of her not-so-chronic coffee addiction. "The key is controlling the numbers and yourself. You must be your own best financial friend," stresses Mr Hall. By documenting her daily spending habits, down to the last drop, Mrs Popplewell is well on her way to becoming best mates with her cash flow.