October 16th, 2009 by John 
in Categories: 
Managing your own personal finances is difficult enough but managing a budget for your family brings with it some new pressures and challenges. Many of us (myself included) have been guilty of neglecting our own finances and personal budgeting however it is crucially important that managing the family expenditure is top of your agenda. I have put together some tips and advice on staying in control and making the process as easy to manage as possible.
1) Know where your money is going. It may seem obvious but there aren’t many people who know where every last drop of their hard earned money is going. Be sure to write down ALL expenditure no matter how big or small. This will give you a very clear picture of where your money is going. Review your “spending diary” after a month or two and identify any areas you can make some savings.
2) Plan your finances together. Money trouble is one of the main causes of arguments between couples. By sharing the responsibility there will be less pressure and you will also get a double perspective on decision making.
3) Start saving as early as possible . Make sure you put a little bit of money every month as soon as you can, it doesn’t have to be a fortune just whatever you can manage. You may want to think about buying your baby products month by month to avoid a large expenditure after the birth.
4) Keep it simple. Staying in control of expenditure is the overall goal, so don’t go creating weird and wonderful spreadsheets which are complicated to manage and use. Keep it as simple as possible – make it extremely easy to find out how much money you have and how much money you’re spending (the most important bits!).
5) Set some realistic goals. Setting goals gives perspective and purpose to your budgeting and will help you stay in control. You may wish to have that loan paid off in 6 months or have something saved up for a holiday. Whatever your plans, make sure you give yourself that extra incentive.
A little bit of time invested in your finances each week will really make a difference and by implementing some of the tips in this post, your finances should really be under control.
Useful Resources:
Mint.com
GregoryPennington.com
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{ 9 comments… read them below or add one }
Hi John,
A great list of tips to help budget our money. I am guilty of this when it comes to saving money and I do like to shop at Walmart. With a family of 5 and I do not work a public job anymore, there is not much money left to save after the bills and necessities. I have been wasting lots of money on the credit card debt we have. I need to get that under control, they are planning on raising the interest rates on us again. Very sad and a rip off to the consumers. I would have to say #2 happens at our house sometimes on the argument side. I take care of all the bills and my husband doesn’t mess with it. It is stressful at times and he does not manage money very well. Just happy he works and I get to stay home now.
Robin´s last blog ..Herbalife Nutritional Shake – Nutrition Facts
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John reply on October 18th, 2009 10:20 am:
Thanks Robin. Saving money can be very difficult. I have found that setting up an automatic savings plan, where the money is deducted before you see it, is the best way to save. After a while, you don't even miss it.
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I heard it said once that the average American family will spend more time planning a vacation than they ever will in considering long-term goals, financial planning, etc. That’s pretty sad, but I don’t doubt it.
I wonder how many marriages could be saved (I believe financial matters are #1 cause of divorce) and how many more family’s could enjoy financial success simply by investing 15 minutes a week communicating and planning together.
That said, I don’t have any firsthand experience in family planning like you do. It’ll definitely be an experience when that time comes!
BTW, as for your first suggestion- I have really, really noticed the benefits of doing this. It can be a pain to keep up with the spreadsheet, but I think it’s well worth getting in tune with what our money is actually doing.
Blake´s last blog ..Why Defined Savings?
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John reply on October 19th, 2009 10:35 pm:
Hey Blake! Isn’t that sad, that we spend more time planning our vacations than planning for our future? I agree that many divorces are probably caused by financial matters. This could definitely be changed through some planning and communication.
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Hi John,
the biggest issue in controlling finances of a family will be on the saving side.
Some just do it the wrong way.
Two examples:
Coupons which give you a cash rebate.
Some really only buy things when they get a coupon even when they don’t need the toothpaste, soup or whatever else. This money would be better put in a saving account (or pay off your credit card debt with interest rate as high as 25%).
Buying in bulk.
There are some stores who offer you to buy 12 liters of milk (expire date within 10 days). i never drink so much milk but they offer it with a rebate of 10 to 30% (in comparison to 12 x 1 liter milk). Afterward you can throw away half of the milk because it’s already expired.
Just my contribution to your great list (or use the free software from my blog post to save energy + money while using your computer
)
cornyman´s last blog ..Save Money, Energy and green your Computer!
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John reply on October 19th, 2009 10:38 pm:
Two very good points cornyman. I am a proponent of using coupons and buying in bulk, but you have to plan and use some common sense. Buying something you don’t need or can’t use fast enough before expiring doesn’t make good financial sense. Great point!
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Hi I would like to commend you for making a realistic steps on financing. What is really I felt that I had made my contribution is by making my life simple. It works if you think of what is the only basic things that you need and not those that only give short-term satisfaction.
Julie´s last blog ..My Adgitize email
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John reply on October 19th, 2009 10:50 pm:
Keep it simple! Great advice Julie!
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These are wonderful tips. Sometimes most things that are thought of being simple are the ones often times overlooked. Focusing on a specific goal can provide a solid guideline to follow and not go astray.
Matt´s last blog ..Twitter Sunday Spotlight: An Introduction
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John reply on October 19th, 2009 10:49 pm:
Thanks Matt! Sometimes it helps to be reminded of what we already know. It brings it to the “top”… and helps us get on track.
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I wish I had followed those ideas when I was much younger. At the moment the only money I spend is the absolute necessity. It is amazing what you can give up when you have to.
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John reply on October 19th, 2009 10:42 pm:
Putting together a good financial plan while we are young is so important Marg. Unfortunately, most of us don’t find this out until much later in life.
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Starting young is very good advice, and probably the one most over looked. Everyone assume's it's something to do later. The other trouble is many young people don't make enough to feel like they can put something aside. But, even a little done regularly will pay big later on in life. We've given this advice to our daughter, who agrees; was gonna do it….but, hasn't as yet. Think it's time to remind her of it again.
Sandy
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John reply on October 19th, 2009 10:47 pm:
I think you’re exactly right Sandy. Most people put off saving until “tomorrow”. But unfortunately, “tomorrow” never comes. We also tried to teach the value of saving and postponing gratification to both of our children… no luck so far! Hopefully, they {and your daughter] will come around some time soon.
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My husband keep track of our finances, I would like to do it my self but it is overwhelming
Pau´s last blog ..Discount Laptop Bag
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Coming from a financial planning background, this is step #1 with our clients. We try to get people on track and educate them on cash flow and where they can save (mortgage, credit cards, life insurance). Obviously we’re in the LI biz, and we’re seeing a pretty big shift from the old days of whole life, pay forever policies to new cheaper, and more flexible term life policies. This should be finance 101 for anyone starting a family.
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