The very thought of a budget is actually quite simple. However, once we look further into it we begin to realize that it isn’t as easy as we first believed. Having a spending or budget plan helps us manage our finances enormously.
Money problems within families can be the root of all manner of conflicts. Dealing with monetary issues is very stressful indeed. Therefore, it’s very important for you to have personal financial planning by creating a family budget.
Here I’ve compiled a small selection of points to help you start your family budget.
1. Assess the financial situation you’re currently in. Before you write out a budget plan have a look back through your spending patterns of the previous year. This will mean digging out all your salary records, utility bills and receipts. If you no longer have copies you can request freshly printed copies from the respective companies.
2. Design a budget outline. If you have a look around on the internet you’ll find plenty of sample budget outlines to download and use. If you can’t find one online they are readily available on books and magazines. Use them to create organized and well written budget plans.
3. Write them out. Once you’ve collected all the past reference income forms you can begin writing out your income. Remember to include wages, tax credits, pensions and anything else – including the current month. Once you’ve done this write down your monthly outgoings – credit card payments, bills, purchases or anything else related. Having a look through purchase receipts and your check book will jog your memory.
4. Check your lifestyle. Next you have to check your family lifestyle. What are their spending patterns? Every family member should get involved at this point. What are the important things each family member spends money on? Also, consider wisely the things you can do without.
5. Plan the following year. It’s wise to estimate your family income for the following year. If you’re due a promotion or pay rise make a note of it. You will also have to consider birthdays, Christmas, holidays or any other special occasions.
6. Learn your credit score. You will also need to check your current credit rating. There are many ways to do this, by contacting the credit bureau of your area or by one of the online credit checking agencies.
Noting down your family budget will help you to realise how important it is to spend money wisely. If you feel expenditure is too high it’s time to start making adjustments to enable you to stick to your family budget.
Saving money is one of the best ways to improve your financial standing. It’s wise to have a substantial sum of money put to one side for a rainy day. As the head of your family it’s important that you stress the importance of savings to your partner and dependants.
The key is to get the whole family committed to making a difference. If you can convince them all to make efforts sticking within the budget is an achievable aim for virtually every household.