Archive | Family Budget Tips

3 Tips That Can Help You Avoid Derailing Your Budget

Here are 3 easy tips that you can use to make sure that your family budget isn’t derailed. Don’t worry, these are NOT very hard to implement and you can start today. The reason you really want to think about this is because creating a budget is only half the battle. Most people are capable of putting together a basic family budget. The hard part is when you run into day-to-day situations that can put your commitment to sticking to the budget to the test.

1) Make sure you have some money put away for emergency situations.

This might take a little while to get set into place, but it’s really important that you set aside some money for emergency situations. Look, it’s a fact of life. Sometimes things will arise that are unexpected. For example, you might suddenly start experiencing car problems. You take it into the repair shop, and are quoted a couple hundred dollars to get it fixed. This ordinarily would break a family budget — but not if you have some money set aside to deal with situations like this.

2) Never go shopping without having a clear idea of what you’re going to buy.

The last thing you want to do is go shopping with only a vague idea of what it is that you need to get. That’s the last thing you want to do. Why? It’s far too easy to buy things that aren’t really even necessary or that you had no intention of purchasing. How often have we gone to a store and suddenly spotted something that caught our interest. Before long, we’ve added it to our shopping cart. This adds up and can bust a family budget easily.

3) Don’t treat your credit cards as being a source of “free cash.”

This is a biggie. The last thing you want to do treat your credit cards as a source of “free” cash. This is a recipe for disaster. You need to make sure that any purchases that you make on your credit card are within your budget. However, a lot of families often find it far too tempting to charge things without really thinking about whether or not it’s a necessary expenditure.

If you heed this advice, you’re more likely to stick to your family budget and to avoid doing the things that can derail it.

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2 Tips That Can Save You Money At The Grocery Store

Let’s talk about two things you can do when you go to the grocery store that can ultimately save you and your family a lot of money and help preserve the budget that you’ve created:

1) Don’t go to the grocery store without having a shopping list.

How often have we all run out of the house with the intention of just getting a few things at the grocery store only to return with bag after bag of things that we hadn’t even anticipated needing to buy? This is something that happens far too often. The solution is to make sure that you have a prepared list of things you need to get before you ever step foot inside the grocery store. This will help keep you focused on exactly what it is you need to get. What if you see something that you genuinely forgot to add to the grocery list? That’s okay. The idea here isn’t to be unreasonable, but rather, to help keep you from recklessly spending money on stuff that you don’t really need or want. They’re impulse purchases — not a good thing at all.

2) Be proactive about coupons and discounts — it’s YOUR money.

Some people think it’s tacky, or somehow “low class” to clip coupons and to pursue discounts. Nothing could be further from the truth. It’s your money, you need to do what you can to help cut your grocery bill. If you know that certain sales happen on a monthly basis, why not buy in bulk (if practical to do so) and shop for those particular items on a monthly basis? This requires having a very organized understanding of everything, but it can really pay off nicely. Many grocery stores provide special discounts to people who have little “cards” that get scanned when you’re at the checkout. Don’t be shy to fill out the necessary paperwork to make sure that you can have access to these little loyalty cards. They often entitle you to additional discounts!

As you can see, it’s not that hard for you and your family to save a lot of money and help preserve the budget that you’ve created.

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Can You Still Have Fun With Your Family While Saving Money?

Many people often wonder if it’s actually possible to have fun with your family while still keeping an eye on expenses. In many ways, this question stems from the belief that saving money and maintaining a family budget is really just another way of saying that everyone has to sit in a candle-lit room with no TV and with a minimum amount of food at mealtime. Nothing could be further from the truth!

What more people have to come to realize is that having fun doesn’t necessarily have to be synonymous with going out and spending a bunch of money that you don’t really have. That’s right — you need to confront the reality of the fact that there’s a very strong likelihood that when you shop, you’ll be using credit cards where a balance is being carried. As you can imagine, this is not a very good situation to be in. After all, who really wants to impulsively shop for a bunch of unnecessary and somewhat unwanted items that hardly every get used?

Let’s assume that you and your family want to go to see a movie once a week. That’s something that can be calculated and added to the budget. Now, the thing you need to keep in mind is that for most people this will also require them to potentially give up something else that they might have an interest in. In other words, it’s very rare that you’d be able to decide that you’d like to go see a movie every week without making some other adjustments in the budget to make sure that you’d be keeping within the parameters that you established.

Here’s the bottom line: you and your family can have as much fun (or even more fun) as you’ve ever had. It all comes down to being accountable for spending the money you have at your disposal wisely. Don’t let yourself believe that maintaining a family budget is the equivalent of being in jail. That’s completely inaccurate and false. Go ahead live a little — life can be short! Just make sure that you think about what you want to spend your hard earned money on without destroying the budget you’ve worked so hard to achieve.

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How To Determine If You Are Being Frugal Or Downright Cheap

As you and your family start to get serious about having a budget and about trying to keep expenses under control, there may come a time when you really need to figure out if you’re being frugal, or if you’re being downright cheap. Here’s a relatively simple way to figure that out.

While it’s true that those of us who are in the process of trying to get our finances under control will often focus on money, there’s also the issue of time. For example, does it really make sense to spend 2 hours clipping a grand total of $7 worth of coupons? Maybe, but probably not.

There’s no exact formula, and everyone will feel a little bit different about this, but you need to really try and measure whether or not the amount of time it takes to get something done is worthwhile relative to the amount of savings you hope to generate. Does that make sense?

Someone who is willing to drive around town for an extra 45 minutes because they want to save a few pennies on gas when they get more fuel is likely to be labeled by any occupants as being cheap. On the other hand, if you’re leaving the grocery store and you drive an extra two miles up the road to get your gas at a station that has a special sale, then you’re being frugal. In other words, you’re not engaging in extreme behavior that requires a lot of time and effort that ultimately only derives a relatively paltry amount of savings.

If you look at everything you and your family do through the prism of what others might be thinking, you might come to the conclusion that you’re being a bit too cheap at times. Nobody is going to like you if inconvenience others in a vein attempt to save a few pennies. That kind of behavior will universally result in you being described by anyone who comes into contact with you as being “cheap” behavior. Yes, it’s good to be frugal — but remember — being cheap typically means you’re not being wise with the use of your time.

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How To Keep Track Of Family Spending Without Being Obnoxious

There’s a fine line between keeping track of the money that your family is spending and becoming an obnoxious jerk about it. You’re not going to be very popular in your family if you follow everyone around with a notebook and pen jotting down all of the expenditures that are being made. Not only will it seem very crass, bu it will really take a lot of fun out of things that should be enjoyable. There’s a better approach.

We know it’s important that we keep track of where the money is going. We can’t just spend recklessly and blindly without accounting for where funds are flowing. So how do we track expenditures without being obnoxious about it?

Think about how how many of us make purchases. We either use a check, or we use a credit card. While it’s true that we sometimes use cash, that cash often comes straight from a bank checking account or savings account. You’ll see how you can track the cash in a moment. But let’s initially turn our attention to credit cards and checks.

Do you literally have to be standing over someone’s shoulder looking to see who they’re writing a check to at the moment the check is being drafted? How about when someone is making a credit card purchase? Do you literally have to be right there monitoring what the money is being spent on? See, this is what would make people feel a bit uncomfortable. Doing things like this would be obnoxious — and they’re completely unnecessary.

You can easily audit checking accounts at the end of the month and even look at the checkbook to see where the checks were made out to — assuming accurate records are kept, which they usually are. Credit cards are laughably simple to monitor. Every purchase results in a line-item entry when you get your monthly statement.

This brings us to cash. How can you monitor that? While it’s not as easily monitored, you can at least get a general sense of how much cash has been spent based on ATM transaction notices that are listed on your banking statements.

By following this advice, you can accurately monitor expenditures without being obnoxious about it. It’s not as hard as it might initially seem!

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Should Your Children Have To Earn Their Allowance?

For quite some time a philosophical debate has been raging. Many parents wonder whether or not it makes sense for a child to have to “earn” their allowance. In other words, should the kids have to do something around the house to actually earn the allowance that they receive — or should it freely be given with no strings attached.

To the extent you’re married, or have a partner who is helping you raise children, it’s important that you have a conversation about this topic so that there can be clarity and consistency. We as parents love our kids. We want the best for them, and sometimes we feel guilty. Why would we feel guilty? Many of us have to work long hours and we often don’t really feel as if though we get to spend enough quality time with our children. As a way of compensating for this, we sometimes indulge our children by getting them nice gifts of providing them with money.

As it relates to allowances, sometimes we just feel it’s better to give them the money without them having to do anything to earn it. This actually makes us feel better about ourselves because we want our kids to know we love them even though we spend long hours away from them at work. However, is this really in the best interests of the child? That’s the challenging conundrum that a lot of parents face.

When you think about the reality that your child will encounter upon leaving the protective shelter of your home, will they be given money for doing nothing? Probably not, unless they become a celebrity — of course, that’s said in jest. But the very serious question that parents have to ask themselves is whether or not they’re ultimately training their children to expect something for nothing by not attaching an allowance to any work output.

Most experts suggest there’s a middle ground. You can certainly give your child an allowance that’s not based on specific tasks being completed, but rather, for helping out around the house when asked and for being generally helpful when help is needed. That’s a reasonable approach worth considering.

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The Easy Way To Show Your Kids How To Save Money

There are a lot of different ways that you can show your kids how to save money. But there’s always a bit of uncertainty over which method might be best. Let’s talk a little bit about some of the reasons why it’s important to have this conversation with your kids, and also provide some strategies that you can use to make the process a lot easier.

One of the key reasons many parents needs to talk to their kids about saving money is because it will provide them with a solid foundation for their own future. After all, very few people can simply live off interest and dividends without having to worry about where the money comes from. So it’s imperative that you have a low-key, relaxed conversation with your kids that helps get them to start thinking about why it’s important to save money. Aside from the obvious reasons like being able to buy the things that they’d want and need in the future, there is another important reason that kids need to realize — the unexpected situations in life that present themselves that require money in a hurry. You need to have some money put away to meet those challenges.

With that said, here are some strategies that you can use to help you have a positive, meaningful conversation with your kids about the importance of saving money. Try to use as many real-life examples as possible. Kids will often relate better to stories than to cut-and-dry instructions that they need to follow. It’s also a good idea to ask your kids a lot of questions along the way, to make sure that they’re actively thinking about what’s being discussed as well as to hear what they might come up with as strategies for saving money.

Perhaps the most important thing you can do is to teach by daily example. You don’t have to make this an awkward situation where you bring up the topic of money at every turn, but our kids soak up what we do and learn by example. Show your kids how to save money by actively doing it and mentioning it every day. Before long, your kids will be well on their way to being financially savvy savers.

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When Does A Credit Card Become A Liability Instead Of A Lifeline?

Credit cards are the ultimate double edged sword that can be both a lifeline and a major liability. From a family budgeting perspective, you’re dealing with dynamite. You really need to have a clear understanding of what role credit cards will play in your family finances. For some people, they’ll merely be devices through which to facilitate transactions without needing to have cash. Presuming the balance is payed off at the end of the month, this is a perfectly legitimate way to use a credit card. It’s acting as a lifeline by facilitating everyday transactions.

However, for far too many people, credit cards become a major liability. Families will sometimes have a slew of unexpected expenses (or sometimes even regular expenses) that arise. How are these things paid for? With credit cards. But then, at the end of the month, a balance reminds. As a result, the credit card company starts to charge interest. This can quickly add up, to the point where — if you’re not careful — you could end up with a significant long-term liability that will simply linger for years and years.

The secret is to be extremely disciplined with how you and your family choose to use credit cards. It’s okay for them to be there as a genuine lifeline and as a mechanism through which to facilitate shopping transactions. Where it starts to become a real problem is when you notice that a lot of un-budgeted discretionary spending is taking place. This is a sure-fire way to run up a massive amount of debt in a relatively short amount of time. At this point, the credit card ceases to be a lifeline and truly becomes a liability.

Here’s the bottom line: credit cards do not provide you and your family with “free” money — it all comes with some very hefty strings attached. Between the high interest and the potential for additional fees, the overall approach that many experts recommend is that you attempt to minimize your usage of credit cards. Don’t ever let yourself be fall into the trap of believing that it’s easy to pay off credit card debt…. it’s not! So be smart, and make good decisions.

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