Recollection is a poor custodian of capital

This Weltee Journal note explains why an individual should not rely on memory to track assets. It cites Richard H. Thaler, Mental Accounting Matters, Journal of Behavioral Decision Making (1999): mental accounting is the set of cognitive operations households use to organize, evaluate, and keep track of financial activities, and it violates fungibility. It cites Brad M. Barber and Terrance Odean, Trading Is Hazardous to Your Wealth, Journal of Finance (2000): among 66,465 households from 1991 to 1996, those who traded most earned 11.4 percent a year while the market returned 17.9 percent, and the average household turned over 75 percent of its portfolio. It cites IRS Publication 552, which states that a person may forget an expense unless it is recorded when it occurs. The note is for individuals who trade, spend, or hold property from several sources. The next step is to write transactions when they occur and to keep supporting documents with the ledger.