I use it for many things (i use hledger)
- Tracking pending payment from clients
- Keeping track of my expenses in various sectors, food (groceries, eatout), books, magazine subscriptions, etc
- Keeping track of my current balance accounts across various currency deposits
- Loans I give to people, and gifts I give to people
- Creating virtual envelops to segregate my savings account money for my goals like travelling, buying gifts for someone, investment goals, etc
This has helped me tremendously
- for reducing my eatout habits and eating more at home by realising just how much I was wasting money by eating out daily, and inputting the saved amount into compound interest calculator to realize potential lost income and wealth from putting those into an index fund account
- to keep track of pending payments from clients and calculating my real cashflow against cashflow based on expected income
- reduce my impulsive spending, by tracking my savings account money with virtual envelops aka 40% for investment goals, 1% for gifts, etc, it helps me to not just see a big balance on my account and start spending it away seeing that money as segregated chunks in my mind helps me stay in my lane.
- I have a program that generates all sorts of charts to track my wealth growth over time, expense growth and decline across categories, which I then dump into a webpage with my notes on how the changes were a net positive or negative outcome on my life, I do it annually to decide what i’ll do next
- I also have a python script that takes my ledger file and converts it into an excel sheet to send it to my chartered accountant to file my annual taxes
I also maintain a separate ledger file for my business (I dont maintain that one manually, I just export the data from accountant’s software, to do my own calculations at home)
- I use it to calculate cashflow projections to predict how my expenses might potentially grow with rise in revenue
- Track categories of spending to spot anomalies in spend across departments
- Calculate whether I should hire more or raise marketing spend, calculate metrics like ROIC (Return on Invested Capital)
The double entry helps me catch discrepancies in accounting if any, by importing bank statements and generating a ledger from that, I have accounts separated by usecase (discretionary spends, employee perks, business inputs) , with each one getting deposit from main account weekly. I use that to calculate if somethings odd and books are all cool.
I have had trouble before with an accountant running pseudo expenses on my books without telling me, just to impress me by showing a high taxes saved, without being transparent, landed me in court once, with a huge fine with late penalties.
Now I dont trust accountants and make sure I double check no matter what.
Plus I have a lot of automation scripts and stuff, imports from stripe account, imports from bank statements, accountant’s own ledger, etc
I match them all with python scripts and try to look for discrepancies.
I love plain text accounting, as a programmer it works for me, I automated a ton of it, and I have tons of my own macros and shortcuts in my code editor(vim) to make things very easy and simple,
I love it overall, I built out my own system on top of hledger across the years.