This summer, while I am on vacation, I am reposting some previous columns, albeit with minor edits. These are columns that are largely timeless. Enjoy!
Originally posted August 30, 2021 — What I learned from my first recorded transaction
The very first plain text transaction I ever recorded is dated August 3, 2015. This was for a museum visit, and it occurred when we were on vacation. As I entered my first plain text accounting transaction, I got to the point where I needed to decide what category the expense was.
Let’s see, museums are educational, so perhaps it should be an educational expense. That didn’t seem exactly right, as there was definitely a strong recreational component, too. Hey, we were on vacation and doing something because it appealed to us. So, perhaps it should be categorized as entertainment. That was closer, but by the same reasoning just about everything we spent money on during a vacation ultimately could be thought of as entertainment. For example, we buy gas so that we can travel to our vacation destination. So the gas expense is entertainment?
What I finally decided on, was to have a category called “travel.” So, if we go on a trip, meals, lodging, gas, and even that museum visit are categorized as a travel expense. Also, the travel expense category is inclusive enough that it still works if the trip is not a vacation trip, such as to help a relative move to a new place.
Obviously, there is no one right way to do decide which category an expense is, but six years later the travel category still works for our household.