How do you start understanding your spend? And how do you begin to get your spending under control? The challenge is simple to describe but not always simple to do. The good news is that it follows a pattern that parents know very well.
The Clean Bedroom
As a parent, I have seen this situation many times. When a bedroom is already mostly clean except for a single wet towel in the middle of the floor, the solution is easy. The child sees the towel, picks it up, and puts it in the laundry. The problem is small, obvious, and quick to solve.
Children who are naturally tidy or who have the discipline to keep their rooms in good order rarely struggle with cleaning. They notice what is out of place and fix it because nothing is buried under a mountain of clutter.
The Messy Bedroom
Now let us consider the other child. The messy room child. This room is a disaster. There are smears on the wall that you probably do not want identified. Clothes are everywhere and some of them may not even belong to your child. Toys cover the floor. Old food has become a science experiment. The room is a complete overwhelming challenge.
How do you even begin to clean this room?
Some experts recommend starting with the trash and then moving on to the laundry and following a clear sequence of steps1. Other experts suggest a different set of steps, but they still recommend having a detailed checklist to stay organized and to avoid feeling overwhelmed2.
My answer is simpler. It does not matter where you start as long as you begin. Pick up the clothes. Pick up the toys. Pick a corner. Pick anything. Just start and keep going. That momentum is what leads to success.
Still, I do agree with the experts. Create a checklist and follow it step by step. But never forget that the most important thing is simply to start.
Start Small
Understanding how your business spends money can feel very similar to cleaning a messy room. You cannot understand everything in a single session. True understanding comes from reviewing your spend data repeatedly and from many different angles.
Once you achieve a basic understanding, you need to stay organized and continue reviewing your spend on a regular basis. This is how you prevent new chaos from forming. The pattern is the same as keeping a once messy room clean.
I suggest starting small. There is a popular saying that appears in many forms. The version I first heard was from a talking cat in the Disney film The Richest Cat in the World3:
I have found many variations of the same idea in books from various authors4,5,6. The message is always the same. Small steps make big challenges manageable.
Summary
However you choose to begin understanding your spend, the most important thing is to take small steps and start the process. Just like a messy room gets worse when you do nothing, your spending will only become more confusing if you never begin reviewing it.