Planning a Tailored Family Budget

One of the most common causes for divorce and torn families is finances. Life is full of a constant demand for a budget that can handle the ever changing nature of family. Any number of factors can throw things off course. Maybe you’ve recently had a baby, or are preparing to send kids off to college. Or, perhaps you’ve become the caretaker for an elderly parent. Moving, job loss or simple overspending can affect whether your family finances stay in the green. So, when it comes to creating a budget, it’s important that you tailor it to your specific situation and needs as they arise.

But how do you find the time to plan as extensively as you need to?

Forget Yourself

Going into your budgetting meetings, don’t even consider yourself as a part of the equation. You are a servant to your family, and the budget meeting is for their happiness and well-being. With this mentality, you and your spouse will be level-headed and your budget will reflect the best interests of others. Which happens to be the way you can feel happiest.

Take stock of all your income.

This may seem like an obvious first step, but many people have their paychecks automatically deposited and aren’t keeping careful track of what is going into their accounts. Find out which dates payments are deposited, including any supplemental income from part-time work, social security, or other sources. If supplemental income isn’t regular, then estimate a monthly average.

Make a list of all essentials.

If you’re struggling with a budget that you often find in the red, you need to think hard about what you need versus what you want. Items such as rent or mortgage, utilities, and food are obvious. Consider the expenses of your automobile You can also consider items such as home or auto insurance as necessary. Your home and car are large-ticket essential items that you need to protect. Companies such as Carter Glass Insurance can help you find policies that fit into specific budget needs.

Plan for the good and the bad.

Be realistic. Once you’ve pared down your expenses to the immediate essentials, take a look at what’s left. You don’t want to work hard every day with no fun in sight. Whatever is left over should be divided into a save and spend “pile”. Put at least 50% into a savings account and forget about it. This can act as your cushion fund for unexpected expenses. The rest can be used for non-essentials and entertainment. If you feel like either of these piles are too small, start thinking, as a family, of creative ways to bring in more income.

Don’t Stretch Your Budget

If your monthly income is $1000, you should not have $975 of it planned for spending that month. If you do this, your budget becomes inflexible. If any expense comes up, or any change happens, your budget is shot for the month. Budget comfortably below what you make and put what you don’t spend in savings.

Use Mint or iBank

Personal finance applications are becoming incredible. With these tools, you can automatically track your transactions, categorize them, and view reports on your spending. You can quickly identify where you are overspending, or maybe where you have over-budgeted. The power of computers empowers you with control of your budget.

Return and Report

Consider it impossible to plan one budget that will last over a couple of months. Take a dynamic approach and go back to your budget plan regularly. Lay out what you have done well and where you have overspent. Figure out how to do better in the coming weeks and months. Re-evaluate your list of essentials. Plan for new goals. The only way to travel the ever changing river of finance is to regularly adjust the course.

Taking your family’s financial future into your own hands will give you a sense of control in what can sometimes feel like an unmanageable situation. No matter what your circumstances are, with careful planning you can design a budget that works for your family.

Category: Budget