After years using pen and paper then a spreadsheet, I recently took the plunge and signed up for a trial of Harvest Time tracking software. I did view others but after a recent UGURUs course and BC Sandpile webinar, I liked the look of Harvest. Very simple to set up, you just add a project name, add some tasks as required then click start when you begin a piece of work and stop when you're done! Simples. The best bit about it is the ease of use and you can use it to invoice clients who pay on an hourly basis although I just use it to keep track of my time per project.
The benefits - ease of use and, assuming you use it regularly, gives you a huge insight into where you spend your time. It has also highlighted many occassions where I have been doing work that I haven't billed for which is not great news for my customers in the near future as I start advising more work will be billable but does help me keep on track with support hours.
Sign up for a free trial - well worth it.