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Comment by stouset | Hacker News Reader

Is it actually all that useful to you to track each receipt line-item? For a few specific types of purchases, maybe, but I'm going to go out on a limb here and suggest you might be taking on needless work that doesn't create value for you anywhere near that level of effort.

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I did this exercise for a little over a year to understand my expenses in detail. Like the OP, I found it really frustrating to do with any bookkeeping software I tried, to the point where I eventually gave up as I didn't think it was worth the effort. I started writing a web app to make this easier but just didn't have the motivation to finish.

With that said, I learned quite a bit as a result of that level of granularity. When all expenses at Amazon, Walmart, etc go into the same bucket, it's really difficult to truly understand what you're spending your money on and if you have a problem you need to curb. Seeing "$X in spending at Amazon" isn't really that useful without knowing how important or frivolous any of those expenses were.

There are many levels in between tracking at the "Amazon" level vs the "Meat:Pork" level. For example I currently track all unprepared food shopping as "Groceries", and would break down "Amazon" shopping into categories such as "Electronics" or "Books".

Ultimately it comes down to how much effort you want to spend categorising spending, but there are many levels of granularity and orthogonal dimensions to slice against

Some stores are modern-day general stores (Costco, Walmart) so you will end up purchasing from several categories on one trip (gift, groceries, home maintenance). YNAB, for example, allows for splitting a single transaction across several categories but you have to figure out what the cost of that individual item was.

It’s annoying to do in Canada where sales tax is not included. The fly in the ointment is that certain categories are tax-exempt (essential foods, kids’ clothing) but not others (prepackaged foods, adult clothing).

If your shopping trip is across three or more categories (gifts, clothing, food), you’ll have to figure out which items were tax-exempt before you can do any subdivision.

You don’t need that level of accuracy, you just need “close enough”. Split things out that are important, but if you’re trying to get the sales tax calculated to the cent you’re going way past a level of utility that matters. Eyeball it and move on.

Sure, and my Amazon example wasn't very illustrative of the kind of information that could be gleamed from tracking this at a more granular level. A more concrete example is that my wife and I were flirting with the idea of reducing our meat consumption (for non-financial reasons) and wanted to see what the financial implications would be. Another example is to try to accurately price out past trips we went on: some things normally get filtered under other categories, such as clothes or other products purchased specifically for the trip.

This level of granularity probably isn't worth it to most people, but I found it useful as an exercise to do once because it opened my eyes to insights about my expenses I never would have thought about otherwise. And if there were software that made this super easy to do (<1 minute per entry), I might still be doing it.

You can do a lot with specific and very little with generic entries.

In NL we got the banks to allow exporting [YOUR] data kicking and screaming. Nothing real time sadly but at least it's a thing now.

I would like to force merchants to do the same.

Enforce some protocol that doesn't suck and it should take 0 seconds.

Imagine the things we could build and how many people we could fire.

I’m with you on that one. Been tracking my personal finances since 2011 and I have yet found a need to go deeper with analysis. Although I can imagine it could be interesting to go extra deep, e.g. to observe changes in my nutritional habits based on my grocery receipts juxtaposed with, say, my bloodwork. But even then it’d be a gimmick as I could not potentially rely on any correlation noticed. I’m sure someone could come up with a better example.

In any case, unless tracking gets super easy, with digital receipts saved directly onto our mobile devices and standardized for processing, I just couldn’t be bothered to break down paper receipts.

That BTW makes me wonder why have we not seen e-receipts standardized yet. We can pay wirelessly with devices, so why not save some more meta data about the transaction, including the receipt itself? Seems like a low hanging fruit, also saving tons of paper.

I agree. I've also been tracking my family's personal finances for about that long.

You have to ask yourself what you're going to do with the data. Don't just collect data for data's sake.

The most granular I've ever needed is things like: "wow, I've spent way too much on hobbies in the past 3 months" or "we've spent way too much eating out this month" or "the kid's sports are getting out of hand". Or even "we can afford to spend a lot more on vacations over the rest of the year".

Those are all very top level categories. I can't imagine a world where I'd ever make a lifestyle change based on how I spend on meat over the past six months.

And if you're not actually making a change then the data is just data hoarding.

Yup. Although even if you’re not making any changes based on your habits, it’s still helpful to track money spent to know where your money actually is, especially the liabilities. Except you don’t even need to track expenses at all, outside of the generic “Expenses” category.

At the grocery store it would be extremely useful to understand where money is going related to other food groups (diary is 10% more). At the garage or clothing store not very useful because the entire purchase is a good group but how much you are paying for meat could help you decide to buy it elsewhere but allow you to keep buying bread.

I feel like it isn't for the vast majority of people. I did a bit of tracking on my spending but it just ends up showing that the vast majority of my spending was on rent and fixed bills which are very easy to track in just a spreadsheet. The amount I'm spending on biscuits and milk week to week doesn't matter at all in the grand scheme.

A lot of banking apps these days will automatically categorize your spending as well which eliminated much of the need to manually enter it in to a different app.

Just tracking no but allocating yes.

If you plan ahead you know how much money you actually have and can plan better.

I find I save way more with a proper budget in place.

A proper budget does not require you to drill down to the level of tracking specific food groups.

Not normally, no. But we track things like cleaners vs food.

I budget very high level but when my wife did her own before we were married she prefered fine grain control. I think it's more of a personality thing.

The sweetspot is to group by providers. Unless you have a huge all in one provider, you'll have enough granularity.

Here are two examples:

1. Amazon shopping. You can buy anything for your life in one place, and the credit card receipt just says, Amazon. Thats too broad a bucket to really track where your money is going. I like to understand, for example, what I am spending on consumables for house upkeep, like light bulbs and air filters, separately from things like bike accessories.

2. Splitting out alcohol and other highly discretionary purchases from grocery shopping. Lets say I want to budget for alcohol spend as a way of gently trimming back my consumption. Or chocolate, candy, etc. Would be nice to be able to do this quickly. The ideal would be to simply scan the supermarket receipt and let OCR figure it out for the majority case (aka the 2 or 3 stores I shop at every week).

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