Tips for Handling Family Finance
What are the things that frustrate you most in family life? Most people would agree that few things can be more frustrating than having a line of bills to pay and not having enough money to pay for them. That can leave you feeling so helpless. But for most families and that might include yours, all it takes is just a closer look at the finances to stay away from that frustration. A close scrutiny and a real honest to good financial planning can go a long way in setting money matters straight.
We have listed here some ideas that you can use if you are having a hard time when it comes to handling the finances of your family. We’re not saying that following these ideas would resolve all of your money issues, but they might help.
Deal with the Numbers
Few families actually spend the time to sit down and deal with the numbers concerning their expenses and their income. Since most families are always busy, budgeting is something that is not prioritized. But you have to take the time and do the math if you want to set your finances in order.
Just sit down with your spouse and have a pen, paper and a calculator on hand. List down all of the sources of income of your family within a monthly period and once you are done with that you can start listing all of your expenses. To keep track of all the expenses of the family, you would need the cooperation of everyone. The key here is to be able to list down everything so that you will have a clear idea on how much you are earning and how much you have to spend.
Cutting Down on Expenses
When you have listed down your income and your expenses, you might notice that there is a huge difference between the two. You might notice how you are spending more than what you are making. That shouldn’t be the case because if you are spending more than what you earn that only means you are incurring debt. What you should do then is to cut down on your expenses.
There is always some kind of expense that you don’t really need. If you still have cable TV for example, this might be the right time to get rid of it. That could save you a few hundred dollars every month. For a family that’s been used to living from paycheck to paycheck, an extra $300 each month can mean a lot. You can find some other expense that you don’t really need.
Allocating the Funds
After you have written the actual figures of your income and expenses, it is going to be a lot easier for you to start allocating the money that you have. You have to allocate so you can prioritize expenses. Some expenses are more important than others. You can start allocating money on a weekly basis. That means you can set aside money that would cover for the expenses on a weekly period. Any money that is left over for that week can then be set aside for your savings account. The amount that would go to your savings might be small but if you do it regularly, then it should reach a significant amount in the long run.
Set Some Limitations
One of the things that you need to agree on with your partner would be the limitations that your family would have in connection with expenses. Both of you should have a limit on the amount that you can spend without having to consult each other first. For example, you can set $300 as your limit. If you want to buy something that costs over $300 then you have to consult your partner first before you make the purchase. This will help prevent any unnecessary purchases because both of you would have to agree first before anything expensive can be bought. This can also help to prevent misunderstandings that can arise from not consulting one another.
If you have children who are old enough then you should include them when you are discussing limitations of your expenses.
Creating Financial Goals for the Family
When the budget and the limitations have been set, the next thing for your family to discuss is what your financial goals are. It’s a good idea to include your children in these discussions. While they cannot offer any insights on how the bills can be paid, they could offer some ideas as to where you should go on vacation and other projects that you would be doing as a family.
When you have decided on goals that would involve your family’s finances, the next step is for you to decide on how you can reach those goals. That’s something that you and your partner should agree on.
The budget has been made, the limitations set and the goals defined, what is your next step to improve your finances? The next thing for you is to become proactive when it comes to your family’s finances. You should work on your money problems even before they start out. There are many money management programs that you can use. These programs will allow you to track your finances with relative ease.
Money Saving for Families
No matter what the financial situation of your family is, you could always use extra money. Here are some money saving tips that your family can use.
One move that you can follow in order to save some money is to go for sales. Stores are always offering sales which you can take advantage of. The trick here is not to buy anything just because it’s on sale. You have to look for the things that you really need that are on sale. Clothes for example are usually placed on sale and you can get a good bargain for those.
Another money saving move that you can follow is to start shopping online. Buying things from the internet is not only fast and convenient, but it can also offer some really good deals. Online stores can offer lower prices because they have less overhead costs. You can also do more searching when you are using the internet.
Going DIY is another way that you can save some of your hard-earned cash. Instead of paying others to do some of the simpler tasks for you, you can try to learn how to do those tasks on your own. There are plenty of guides that you can turn to on the internet when you want to do research for those DIY tasks. There are some simple tasks at home that you should learn how to do on your own instead of hiring someone.
Another great way that you can save money is by growing more of what you eat. If you have a small plot of land, you can start a vegetable garden. The amount that you can save by growing your own food might not be that much, but at least you know that you are eating healthy food that’s free from pesticides and chemicals.
Don’t worry when you don’t know much on how you can handle your family’s finances. Everyone has to start at some point, but by keeping these simple things in mind, you will be on the right track. You do not have to learn anything complicated to get your finances in order.