Step three – Track your Income and Expenses

In the previous two weeks I introduced step #1 and #2 of the 10 steps on how to make it in the third world. Step #1 highlighted why getting yourself educated and/or developing your skills/talent is important.  In Step #2, we showed why earning an income in a timely manner is vital, and also highlighted ways in which we can start earning income quickly and the opportunities that exist out there right now.  This week, I will introduce Step #3, which if you read and follow, will put you three tenths or 30 percent of the way to becoming a Third World Success (TWS).  Do you feel like your financial and personal life is going around in circles? Do you see yourself working harder and doing more but like a hamster, running faster and faster on his wheel, no matter how hard you work you seem to be getting nowhere? Well it might be because you are not tracking your income and expenses.  Read on if you are tired of being just another rat in the rat race*.


Step #3 – Create a BudgetTrack your income and expenses


Ok, this may be where I am going to get a lot of readers nervous.  The word ‘budget’ is disliked by most people: it’s like kryptonite1, or as states, the word budget for some individuals is equated to the much hated word ‘diet’. As it is with most people around the world, 61% of adult Americans do not have a budget, according to the website. Whenever the word ‘budget’ is mentioned most people scurry to get away like cockroaches when you turn on the light.  Or they will look at their watches like there is somewhere real important that they need to get to, then their eyes glaze over and they slowly zone out; not unlike how darkness slowly disappears at the dawn of day.  Suddenly you realize it’s a conversation of one.  But this is where we will start to ‘separate the wheat from the tares’ as in the Bible parable regarding proofing who is genuine and who is not.  This is where we will see, who truly is tired of the rat race and wants to become a Third World Success (TWS).


What is a Budget? A budget is simply a financial plan, that lists all your expected income and expected expenses over a given time period.  A budget may be done daily, monthly, quarterly or for lengthier periods of time such as yearly or even a longer time horizon budget/plans.


I don’t have a lot of money so why do I need to track it? – You have just in that question also provided your answer.  Think about it, if you had an unlimited amount of money, you would have less need to create a budget.  It is precisely because our resources are limited why we need to track what’s coming in and what’s going out.  I have heard all the excuses and clever lines before; ‘I know what’s coming in, it’s called “not enough”. ‘I know what’s going out, it’s called “everything plus interest”.  Or ‘anyweh (anywhere) it mawga (thin) it pop (breaks).  Or ‘I don’t need to write it down I can just “judge it”. Which is the Jamaican way of saying I can just ‘guestimate’ my budget and figure out how much I need to spend per month.  This is why many working Jamaicans find that they have too much month at the end of their money.  I am guessing that it’s the same predicament with people in other Third World countries and even developed nations.  Creating a budget is realizing the truth about your finances. Like in other life situations many individuals are afraid of facing the truth as it is easier to live in denial. It may be easier to “wing it”, but not facing your financial reality will bite you in the long run.


So TWSG where do I start? – Track and record your income.  As defined in Step #2, income is basically money coming in.  Get two blank sheets of paper; write income on one and expenses on the other.  For the income sheet you are going to put three headings: 1. Monthly Income 2. Income you may receive only once per year (for example, bonus pay) 3. Irregular income – this is income you receive on an irregular basis (for example overtime, gifts, remittance etc.).  I want you to really think of all monies coming in on a yearly basis. For example, tax returns, insurance refunds, contribution refunds etc.  Take some time to think about it and really try to write everything down. Now take that sheet and stare at it for ten seconds, that is it, there is no magic money coming in!  That is the extent of your income as it currently stands.  Therefore this is what we have to work with to start building your wealth, and we have to make it work within the context of what you have just written down. What if I don’t earn a fixed income?  If your income is variable like that of someone who works on commission, write down the average of what you would get: put your best month together with your worst month and divide it by two.  Or, take the total of what you earned last year and divide it by 12 – use that as your ‘guesstimated’ monthly income.



What next? – Track and record your expenses.  For the purposes of this guide, expenses are monies leaving your pocket.  Anything that takes money away from you are expenses. So you are going to break down your expenses into three categories: A) Monthly ExpensesB) Yearly or infrequent expenses, C) Long Term Liabilities**.

A)  Monthly Expenses – you are going to break down your monthly expenses into different categories. I will give you examples of categories below. However, really think about this and don’t leave anything out.  You may add more categories as your needs may be. For people with children and/or other dependents, you can either create a separate category for them or incorporate them in the overall budget.  You need to write everything down. There is no magic money coming in to pay for these things, once there is money leaving your pocket, it has to come from somewhere – your ‘in’come.

  1. Rent – Rental you pay for your current residence.
  2. Electricity – residential cost of electricity paid by you.
  3. Cable/Netflix/Satellite/TV/Home Internet Bill
  4. Mobile data/credit or post-paid bill
  5. Monthly health/Life insurance (paid directly by you)
  6. National Social Security contributions. In Jamaica we have NHT(National Housing Trust), NIS(National Insurance Scheme)
  7. Monthly Income Tax, and other tax contributions. In Jamaica we have Education tax to pay in addition to income tax.
  8. Petrol
  9. Transportation
  10. Food/Groceries
  11. Lunch
  12. Personal Supplies
  13. Household supplies
  14. Children supplies
  15. Dependent supplies
  16. Pet/Animal supplies
  17. Gardner
  18. Helper
  19. Entertainment
  20. Philanthropy – this includes money you give to random strangers, family, friends, church, charity etc.
  21. Miscellaneous – this includes random small items purchased that was needed and things such as paying to wash your car etc.

B) Yearly/Infrequent large expenses– these expenses happen usually once per year. They may occur more than once per year but usually no more than two to four times per year.  I have listed a few below, you may add more as per your need.

  1. Car insurance(s)
  2. Car maintenance – You will need to budget for Servicing, Tyres, and small repairs etc.
  3. Car registration etc. – Paperwork needed to be legally able to drive your vehicle on the government’s road.
  4. Medical – This includes medical check-ups, doctors’ visits and money set aside for minor illnesses etc. Please note that this should not cover large medical emergencies and illnesses.  I recommend you get health insurance to cover such emergencies.  I will cover insurance in a later article.
  5. Dental/Skin Care/Cosmetic treatments
  6. Clothing – for both you and your dependents
  7. School Fees
  8. Amazon Prime Subscription
  9. ShipMe and or other shipping subscriptions
  10. Home improvement and Security
  11. Large yearly philanthropic donations/contributions
  12. Holiday and birthday gifts

C)  Long Term Liabilities– These are Multi-Year long-term Commitments. They can range from two years to as much as forty or even fifty years.  List all the long term debts and commitments, I have given some examples below. However please think about this and list all the long term liabilities you may have.


  1. Mortgage/House Loans/Other Real Estate Loans
  2. Car Loan(s)
  3. Long term leases
  4. Long term Furniture Loans
  5. Long term higher purchase agreements
  6. Equity Loans
  7. Students Loans
  8. Personal Loans
  9. Alimony
  10. Child support – yes you have to consider these payments too.



Why is this step, Step#3 important? – If TWSG is your guide to financial health, this Step #3 is the diagnosis of the disease or problem. After you have listed all your income and categorized and listed all your expenses, then you can see the bigger picture you can literally see your financial health right there in front of you.  The aim of Step #3 of the 10 Step Plan is to track what is coming in and what is going out.  At this stage, I do not need you to adjust your spending.   For two consecutive months, pretend you are just an observer and all you are doing is recording information as you receive it.  Each time money leaves your pocket I need you to write it down under one of the above categories.  For example, if you went to Island Grill and bought dinner for you and your  family/dependents then write this amount down under ‘Food’ category.  If you are at work or School and you bought something to eat during the break, write this down under the ‘lunch’ category.  If on your way from lunch a co-worker ambushes you and asks for some money to help them buy lunch, then write this down under the ‘philanthropy’ category.  You get the picture by now, I hope – DON’T leave anything out, write everything down. In Jamaica we have a saying that ‘every mickle makes a muckle’, which means that every small thing adds up to a big thing.  It’s not usually some mysterious large purchase that causes us to overspend.  It is these small overlooked monies leaving our pockets that add up over the course of the month that usually does the damage.


Can’t I skip this step and still become successful? – NO.  As Ayn Rand said, ‘you can ignore reality, but you can’t ignore the consequences of ignoring reality’.  There are no shortcuts to success; you have to be willing to do the work.  You will not get something for nothing.  If you are tired of running faster and faster on the hamster wheel of life only to find that you are not getting anywhere, then follow these steps on TWSG and I promise that you will start to see a difference.  You will hold your head up from the rat race of life and look left and look right and realize that over a million US Dollar millionaires are created around the world every y491701591-612x612ear; that’s over two thousand millionaires being created every day. You can be one of them. But it won’t come overnight and it definitely won’t come without doing the work. Get a notebook now, start to write the categories above down.  You can use good old pen and paper to track these expenses.  However, below I have listed some great apps that you can use to track these monthly expenses. A good thing about some of these apps is that, after you have created the category of expenses you can just add entries and it will give you a grand total of the expenses by categories at the end of the month or week or whenever you want to see a summary of the expenses by category.  These apps should be available on Android and iOS app stores.

  • Money Plus (this is what I use personally – may not be available on iOS)
  • Dollarbird
  • FudGet
  • GoodBudget
  • Mint
  • Mvelopes
  • Wally

Check out these app’s reviews at


Congratulations you have made it all the way to the end of this article and you are already among the few who are willing to do the work towards their future success.  There is a lot more I would say under this Step #3, however the outline I have given you will put you on the way to becoming a TWS.  Stay tuned next week as I will outline step #4 of the 10 steps to make it in the Third World.  If you have made it all the way to the end, type in the comments ‘I am a success’.  It will be fun to see all those who will be confused by this comment.  You will be able to tell that they have not read all the way.


Our actions now will determine future results.

Instagram: Ricky.Lindo.ja

*Robert Kiyosaki the author of Rich dad Poor dad describes the rat race as a frustrating, hard-to-break financial lifestyle (self-defeatist cycle):  an employee works hard for an employer to receive a raise or a promotion and as their income increases, their expenses increase as well. As the employee’s debt increases, he becomes further tied to their job and more reliant upon their pay check. Furthermore, they are forced to work harder for their next promotion to offset their debts.
** Long Term Liabilities – long-term liabilities in accounting are obligations that do not become due for more than one year from the date of which the facility was initiated. Since most financial cycles and salaries are quoted on a yearly basis.  We will, for the purposes of this article, define long term liabilities as any financial obligation that is due in more than a year’s time.
1Kryptonite can be described according to the oxford dictionary as something that can seriously harm or weaken a particular person or thing



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