Do you and your family members stick to a family budget? Many families struggle with their finances; one basic reason is not even knowing how to make a family budget. The task itself seems difficult and extremely unpleasant. Putting finances down on paper or the computer might expose the ugly truth – that your hard-earned money is somehow being wasted or extreme cutbacks need to be made. Payless Power, providing cheap electricity in Dallas, can help by giving tips on making a budget your family can adhere to!
- Sit down and discuss your goals. A bigger house, a luxurious vacation, or college tuition savings may seem like impossible dreams at first, but a good budget will help you meet your goals and keep your spending in check.
- Get out the paper and all of your monthly bills including rent or mortgage payments, insurance payments, and utility bills. These are your fixed monthly expenses. Some of these may vary somewhat from month to month, in which case you need to take the average amount spent. This is also a good time to look at your credit card balances and bank account balances.
- Figure out how much money is spent monthly on groceries, entertainment, personal care (hair -cuts, manicures, pedicures, etc.), and any ongoing dental or medical expenses. Be honest with yourself – how much do you spend daily on coffee, snacks, lunches, or lottery tickets? Do the math and multiply that daily total by 30 for your monthly expenses.
- Develop your budget plan by analyzing the credit and debit information you have gathered. Finance experts have developed several budget plans available online or at the bookstore. Having a structured plan can be very helpful if you struggle with this phase of the game!
- Pay off high interest loans and credit cards first. Homeowners might consider opening a home equity line of credit with just a single payment and much lower interest. The interest may be tax deductible, and you should check with your tax advisor and loan officer before signing on the dotted line.
- Anticipate and predict your monthly discretionary expenses, and add an additional amount for any unexpected needs or emergencies. Set this amount of money aside and pay cash for purchases at the stores you visit. This might help restrain and discipline yourself to only buy the items you really need.
- Pay yourself each month, even if it seems like a small amount. Putting a specific amount from every paycheck into savings is less painful if you set up a direct withdrawal/direct deposit with your employer/bank.
- Stick with your new budget for 3 to 6 months, and take time to sit down and reevaluate your plan. By then, you should be able to see where the money goes and make the necessary adjustments.
Planning a family budget may seem like a daunting task, but it doesn’t have to be. Payless Power, your source of cheap electricity, hopes these simple tips help you on the right path to making your family budget!