Many people hear the word budget and immediately think, “I don’t want to be bothered, or that’s a lot of work.” When raising a family it’s almost a necessity. The same paycheck you’ve always had now must be used for so many more things.
Making a family budget is easier than you think. The original setting up will take a little time and effort, but after that it’s just a matter of following it and making slight adjustments.
First you need to know where all those greenbacks are going. After all if you don’t know where you spend it, you can’t slow the flow.
Keep It Simple
Use a pen and paper or an online spreadsheet whichever is easiest for you. On one side list all your fixed expenses. These include rent or mortgage, utilities, insurance, and food.
Anything you are obligated to pay and things you absolutely require to survive should be included. Looking through your bank statements and credit card receipts for the last few months can help with this.
Next make a subcategory for discretionary spending. These are the extras like dining out, gifts, travelling, and things that are not absolutely essential.
On the other side list all your income. This will include your work pay, interest received, and any money that comes into the household.
Subtract your spending from your earnings and this will tell you where you stand. You may find you have a little extra or you may be in the red. Like many of us you’ll barely be even or more likely in the red. Here are some tips to help get you on your way to being in the green.
Pay Off Debt
Always pay the minimum due on credit card accounts and try to add any extra amount you can spare. You will save a good amount of money in interest and when eventually paid off the amount of the payment also.
If you have too many bills due at the same time most companies will change the due date. Give them a call.
Get The Most From Your Money
Squeeze each dollar for all it’s worth by shopping specials and using coupons. You can find a coupon for almost everything you buy and they should be treated just like money.
Any money saved by using coupons can go towards paying down debt, savings, or a small splurge.
This will avoid interest fees on credit cards, ATM fees, and accidental overdrafts. Seeing the actual money leave your hands can also help deter spending.
At the beginning of the month try to think of anything extra you will need to spend money on. This way you will be prepared to cut out any discretionary spending you can to make up for the extra money going out.
Have some money from your paycheck direct deposited into a savings account. A good starting amount is 5% and when you get accustomed to that, raise it as much as you can. If you don’t see it, you won’t miss it.
If you are lucky enough to get a raise put that money into the account also. Even if you can only afford a few dollars a week, putting it into that account will get you into the habit of saving. Having a goal in mind like a home, vacation, or college fund will convince you to keep your hands off.
Make sure you do spent some money on the fun things in life or the budget will become the enemy. Grab some cash and coupons and head out for a nice family break once in awhile.