Tracking expenses is one of those things that sounds simple but quickly becomes overwhelming. You may have hundreds of transactions from your credit card or bank account, and while the data is there, it is not always organized in a way that gives you insight. This is where ChatGPT can help. By feeding it a list of transactions, you can quickly get clean, consistent categories that make your finances easier to manage and analyze.
How does ChatGPT help with categorizing spending?
One of the best things that AI is great at is taking unstructured data or input and turning it into structured data. In this case, ChatGPT can take raw text inputs like transaction descriptions, merchant names, and amounts, and assign them to categories such as Food, Travel, Entertainment, or Utilities. Instead of manually tagging each line, you can let the model do the heavy lifting, then review and adjust as needed.
How It Works
Step 1: Export Transactions
Start by downloading a CSV or copying a list of your transactions. Most banks and credit cards let you export data with fields like date, description, and amount. Let's say we have the below (obviously fictional) data:
Step 2: Prepare the Data
Once the CSV is ready, it can be uploaded directly into ChatGPT along with a clear prompt describing how transactions should be categorized. For a business, this often means aligning categories with internal reporting or accounting standards. You might want to classify spend by department (Marketing, Sales, Operations), by expense type (Travel, SaaS, Office Supplies), or by budget groupings (CapEx, OpEx).
For us, we ran this prompt:
Leveraging this CSV file can you create a new column that is called "Spending Category" and categorize it into one the following: Meals, Transportation, Retail Purchases. Return a new CSV file.
Step 3: Audit Your Data
Now that we have the CSV file returned, let's check to make sure it's correct. In this case, we've returned spending categories that most closely fit the categories we provided! We've saved a lot of time.
Other Considerations
We have a simple example here, but you can leverage this to create much more complexity in your data transformations. It is important to recognize that there will be limits to the amount of transactions that we will be able to share in each batch of requests to ChatGPT. If we have a much larger number of transactions. We should consider leveraging another tool (like Paradigm) that can scale with our data and give us more flexibility.
So What?
At the end of the day, categorizing spending is not about labels, it is about clarity. When your transactions are neatly organized, you can spot patterns, track progress against budgets, and make better financial decisions with confidence. Instead of spending hours cleaning data, you get back time to focus on the insights that actually matter: where you are overspending, where you can cut back, and how to plan for the future.
ChatGPT makes this process accessible even if you do not have advanced technical skills. What used to require manual data entry or expensive software can now be done in minutes with a simple CSV upload and a well-written prompt. The result is cleaner books, faster reporting, and smarter choices about your money.
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