Keeping on track of your family’s finances is one of the most important parts of running a smooth and orderly household. Simply put, money keeps everything running smoothly. Maybe you’re planning a big holiday or want to lessen the financial pressure. Unfortunately, it’s far easier said than done to keep your family’s finances under control.
The first step to getting a grip on your finances is know exactly what you’re dealing with. This will involve setting down, possibly at a laptop or with a pen and paper, pulling out your bank statements and working out exactly where your money is coming from and where it’s going.
Once you have a clear idea of what’s going on with your finances, you can do something about it. In the best-case scenario, you will find something really obvious that you can change, potentially saving money with only minor sacrifices. A neglected gym subscription that you’ve forgotten about, for example. However, life isn’t always as simple as we’d like it to be.
Sometimes the problem is more spread out than that, or it’s a case that your expenses outweigh your income. You may find that most of your money is already spent on “needs”, and not “wants”. So, what can you do?
Set a Budget
Once you have an idea of how much money you spend and on what, you can start to change things. This will help you to save up and may give you some much-needed wiggle room. The best way to do this is to control your spending.
You can control your spending by creating a family budget. This should include groceries, bills, debt repayments, and other necessities. Families are, by their nature, unpredictable, which means that it may be helpful to put something aside for an emergency fund.
If you can, include some “fun money” for a day out with the kids or a nice meal in a restaurant. This way, you don’t feel as though you’re depriving yourself or your family and are more likely to stick to your budget.
Repay Major Loans
Many families also have loans and debts. These may be for large purchases, such as your house or car. But it could also be smaller credit card debts or other loans that you’ve taken out, like a student loan.
It’s tempting to only pay the minimum amount when repaying these loans, as it feels as though you’re under less pressure. However, this will eventually add up as you’re constantly paying the interest rate. Not only that, the pressure takes longer to go away.
Generally, it’s better to repay your loans as quickly as possible so that your expenses are lessened. By calculating loan repayments and paying as much as you can afford, you’ll soon improve your financial situation.
One final way to improve your finances is to boost your income. Even a side hustle that nets a few hundred dollars a month can take the load off, and may only take up a few hours of your time each week. Look into options and you never know what you may find.
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