A Budget: Why Your Family Needs to Have One!
Despite the importance of making a budget,
for many people, just the word intimidates them. It conjures up mental images of living on Ramen noodles, or never taking a vacation.
I remember when I was newly married, and I drafted my first budget for our family.
I was extremely surprised at the amount of money we would need to make ends meet.
Below are the reasons why YOUR family needs to have a financial plan:
1. It will allow you to see what expenses you have and how much money you are currently spending. With this information, you have a better idea of what you can eliminate, and how much money you need to be earning to make ends meet. I personally recommend the envelope system as an efficient and easy way to keep track of your money.
2. You are better prepared to set up a savings plan. Once you know how much money you need to live, your family can more easily decide where you are able to “cut back” in order to save money.
Free Downloadable Microsoft Office Family Budget Template
3. It is an excellent tool to help you get out of debt. It helps you to ask yourself the hard questions like: “Do I really need to eat out every week?” or “Do I need Cable Television?”
4. It helps keep your family informed. Sit down with your spouse if applicable, or your older children, and explain to them exactly how much money is allotted for certain items. This keeps you and your spouse on the same page, and helps your children to understand the value of money.
Remember, successful small businesses, large corporations, and even our government operate within financial guidelines--your family needs them too.
What if you make one and find out you can’t meet your monthly bills?
First, evaluate what extras you can eliminate. Can you cut out your snacks or sodas from the vending machine at work? Can your children pack a lunch instead of buying it at school? Think about this: If you or your spouse spends $1.00 in the vending machine each day at work, that is $5.00 a week, $20.00 a month, $240 a year!
Next, think about ways to increase your income. Can you sell some things on Ebay each month? How about babysitting a few nights a week? Can you take a part time evening job?
Making your own budget will be trial and error. You have the freedom to change things and re-evaluate in order to make it work for your family. Whether you are newly married, married with children, or a single mom, now is the time to get your finances in order. Do not get discouraged—debt free living is worth the effort.
Most Common Financial Planning Mistakes and How to Avoid Them
More Debt Free Tips for Planning Your Finances
Using the “Envelope” Money System with Modern Software
Financial Planning Ideas for Single Moms
Recommended Percentages for Each Major Category
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