Family Budget And Finance Tips

Family budget and finance tips to show you where you are spending your money, and where you could be saving it.

A budget may not seem like something that is necessary for most families. The truth is, if you are able to pay your bills each month you may be tempted to think that you are doing a pretty good job of managing your expenses. Actually, everyone should have a budget. By preparing a workable budget you know exactly where your money is going and can plan for unforeseen emergencies. The key word in this plan is workable. If your budget is too strict, or if some members of your family are resistant to the idea, your budgeting efforts will not succeed. A common misconception is that a family budget means belt tightening and no more pizza dinners or that you will have to start smuggling your own candy into the movie theater. A true budget makes allowances for what ever is important to you, including entertainment expenses and shopping sprees. By spending within your means, you can lose the guilt that goes with such splurges.

The first step in preparing a workable budget is to track your spending. For a month, keep track of every dime you spend. For items that you do not get a receipt for, such as your morning coffee or newspaper, you should jot down the item and the amount in a small notebook that you carry with you. Remember to include parking expenses, dry cleaning, and ATM fees. At the end of the month, sit down and figure your fixed expenses, such as house and car payments, and credit card debt. Then start the process of sorting through your receipts and figuring out how much that daily can of soda and candy bar cost. Once you have figured out your total monthly expenses, make sure that this amount is less than your total net pay. If so, you are in good shape and can continue with the budgeting process. If not, you need to look at some areas that you can pare down your expenses. Perhaps you can take your lunch to work a few days a week, or maybe do your nails at home, rather than in a salon. The most important thing is to make changes where you will least miss it. If you truly savor your morning cup of gourmet coffee, continue to buy it and enjoy. If you get a sandwich from the deli every day and quickly choke it down behind your desk, perhaps you would be just as happy bringing a bag lunch saving yourself time and money. Remember, saving five dollars here and there quickly add up to hundreds of dollars at the end of the year.

If your expenses are less than your take home pay, CONGRADULATIONS! However, do not stop there. Perhaps your budgeting experiment turned up some areas of wasteful spending that you had not realized. This is the perfect time to remedy that. By cutting out wasteful spending, you free your cash up for things that are more important, maybe a beach vacation, or maybe a wonderful retirement. Of course, by planning your budget you may have realized that you are uncomfortable with the amount of credit card debt that you have. If this is the case, you should continue to make the minimum monthly payments on you are all of your credit cards except for the one with the highest interest rate. The card that has the highest interest rate should get every dime over the minimum payment that you can spare each month. Once this card is paid off, you can move onto the card with the next highest interest rate, and so on.

Maybe the budgeting process has made you uncomfortable with the amount of money you are saving for the future. If this is the case, you should plan to put a little extra into your savings account at each payday. If you wait and put in what is left over, you will never have anything left over. Even a small amount, five or ten dollars will ad up. Once you get used to the fact that you can survive without the five or ten dollars, increase it by five or ten dollars. Your eventual aim is to be able to set aside ten percent of your paycheck each month for savings. You should reach that goal on your own timetable. If you try to alter your spending habits to radically, you will become frustrated and give up.

The last chore to take care of when planning your budget is to figure the amount of disposable cash you are going to need each week. Add up the amount you spend on lunches, newspapers and parking tolls in any given week. Add ten or twenty dollars as a cushion, and go to your own bank's ATM once a week and withdraw that amount. Do not stop at any other ATM during the week. Not only will you find that you save money when you know that it has to last all week, but you will also save on ATM fees.

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