The Quick Homemakers' Guide to Successfully Budgeting for the Family
Sep 23, 2020 8:31:00 PM
Sticking to a budget is already a formidable challenge for most people, but it’s even more palpable for those who are also supporting the needs of their family members. If you’re a homemaker who’s tasked with designing and implementing a budget for the whole family for an entire month, you know just how frustrating this can be.
Budgeting for a household can seem like a never-ending struggle, but it doesn’t have to be this way. Below, we’re sharing a step-by-step guide that will help you maximize your resources and come up with a budget that’s suited to your family’s particular needs.
Find Out How Much You Can Spend
The first step in creating a budget that you can stick to is finding out exactly how much you can spend for a particular period of time. Sit down with your family members and discuss each member’s contribution to the family fund in detail.
You and your partner can decide to put your entire paychecks in the household fund, and that’s perfectly fine. Alternatively, you may have multiple earners in the family, and each member simply contributes to the household as they see fit, and that’s okay as well. The point of this exercise is to simply find out how much money you can consistently expect to go towards the family’s expenses every month.
Track the Way Your Household Spends Money
It’s important to look at your household’s spending habits first before you attach a particular amount to your fixed and flexible expenses. Track how much you actually spend on each expense category for over a month or so. This way, when you finally sit down to work on your budget, you can use realistic figures that reflect your expected expenditures and you can set aside a sufficient amount to meet these needs. Take advantage of the apps that come with free analytics tools and use them to get a better picture of how your household spends money. This, in turn, can provide you with valuable insights that will help you refine and update your budget allotment.
Now, keeping a close eye on how the other members of your family spend money is a difficult task, but technology is on your side. There’s an abundance of budgeting apps out there that can help you track the spending habits of your family members in real-time.
You can use digital wallet apps like PayMaya to pay your household bills, transfer money to your family members, or even pay for your everyday purchases. If you have students at home, you can use the app to send them their allowance for the week or month. Should you need to review your expenses, you can simply check your activities in the app to see your financial transactions. PayMaya also has a 5-card bundle promo that you can use if you want to help your family members get used to making cashless transactions.
Distinguish Your Wants from Your Needs
Making a clear distinction between your wants and needs can help you significantly cut down on your unnecessary expenses. Needs are necessities that you can’t compromise on, such as emergency savings, food, rent, water, electricity, and transportation. Your needs are essential to your health, safety, and well-being, and you must have access to all these to live decently and thrive. Wants, on the other hand, are expenses that can help you live more comfortably and support the lifestyle that you want to lead. These expenses can include non-essential holidays, lunch out and drinks, and designer clothes and bags.
Take note that each family’s wants and needs are different. It’s worth sitting down with your family members to determine which of your expenses are wants and which are needs. If a good chunk of your household funds goes towards satisfying your wants, then it may be time to find more affordable alternatives that suit your budget and standards.
If you have significant wants that you want to fit into your budget—like a family getaway—it would help to make a plan to meet this expense. You can make it a goal to save a particular amount every month, for example, so that you won’t have to dip into your emergency savings just to afford this much-needed R&R.
Make Sure Everyone’s In On the Plan
Finally, ensure that every member of your family understands your budget. Discussing money issues openly and honestly with your partner can help you avoid conflicts, and it will give you more opportunities to work on possible financial issues that may spring up in the future. If you have kids, allowing them to take part in the budget discussion can help them understand the value of money at a young age. You can even use these discussions as a jump-off point for building healthy financial habits that will prove to be beneficial to them in the future.
Budgeting for a family can be a stressful task at times, but you don’t have to bear this burden alone. Don’t hesitate to talk about finances with your family so you can find a solution that works for all of you.