It may be the season for shopping and spending, but that doesn’t mean you can’t think about saving money and better budgeting too. Especially as you turn the corner of another year, you should take some time to assess your family’s expenses, income, investments, and spending habits. If there’s room for improvement or if recent changes in your life or circumstances warrant a financial revamp, don’t wait until January 1st. Start now. Here are some simple budgeting tips for families that can easily keep your household on the right financial track.
Money-Saving Tips to Reach Your Family’s Goals
First, don’t dwell on the money mistakes you’ve made in the past. Learn from them and move on. You can change your habits, especially with the support of the people in your family. And while you may have some clean-up work to do, learning healthy new habits will set you on a course for a better future and teach your children responsible financial behaviors.
Set a Savings Goal
What do you want to save for? What do you need to save for? How much money do you need for these goals?
When you clarify and agree on your goals — whether it’s a new car, a down payment on a mortgage, a big family vacation, college education, or (hint) an emergency savings fund — it becomes easier to find the self-control required to achieve it.
P.S. It doesn’t need to be a big purchase, either. Simply having a goal to prioritize and work toward will give you focus and motivation.
Map Out a Timeline & Set Benchmarks
Once you’ve figured out what you’re saving for and how much money you’ll need, it’s time to figure out how long it will take to reach your goal. Figure out how much money you can set aside with each paycheck, and then calculate how many paychecks it will take to complete it.
Visualize and keep track of your progress. By breaking down your timeline into weekly, monthly, and/or quarterly goals, you’ll add some easy accountability and be able to celebrate when you reach milestones.
Nothing Is Too Small
When your family’s budget is tight and you don’t see how you can make any significant impact to your savings, it can be easy to give up – or not even get started. Please know, however, that no amount you invest in your savings is too small. Even $1 a day makes a difference.
The key is finding an agreeable sum that you stow away on a regular basis while still meeting your other financial obligations. If you come into a windfall like a bonus or monetary gift, you can (ideally) add that to your savings.
Another money-saving tip is to set up a family piggy bank and collect all your loose change around the house, and when it gets full, bring it by your 1st Ed PA credit union to add it to your savings.
Common Sense Budgeting Tips for Families
It’s hard to save for your future or pay down debt if you have no idea of incoming money and outgoing expenses. Building a monthly budget for your family is vital. Just like with a savings plan, implementing a budget helps you stay on track, visualize your goals, and gives incentive to celebrate when you reach a milestone.
Financial experts usually advise a 50/30/20 percentage breakdown for your income:
- Fifty percent goes toward needs expenses like mortgage and utilities.
- Thirty percent is allotted for wants.
- Twenty percent is for getting rid of debt.
If you can save money in your wants column — all the better. Use that money to pay off debt faster or stock it away in your savings accounts.
Budget Building Basics
- Calculate your family’s total income.
- List your expenses.
- Subtract your outgoing from your incoming.
- Track every transaction (a good way to stay accountable and on track).
Expect the Unexpected
When you plan out your budget, realize that not every month will be the same. Some months you might need to factor in school supplies, some months you’ll have a birthday or a holiday, and sometimes, your car will need an oil change or a new set of tires. Put a buffer in your budget that will take care of unexpected costs, and be prepared to adjust your budget as needed for different, but necessary, expenses.
Go Big, Then Go Small
Experts suggest starting with your family’s biggest budget categories first – this includes savings. But the other monthly expenses you should prioritize include food, shelter, utilities, and transportation.
Add in Safeguards
If you find that there are certain categories in which you overspend regularly or are constantly fighting the urge to break your budget, leave your debit/credit cards at home and use cash instead. You can adopt an envelope system for things like gas and groceries that can help your family keep track of spending and stick to the agreed-upon budget.
Use Online Support
If you’d rather not put pen to paper or the idea of organizing a spreadsheet gives you a headache, there are a lot of apps and digital sources that can make the process a whole lot easier. Some examples include:
- Every Dollar
- Personal Capital
General Tips for Your Family’s Budget AND Savings
As we briefly mentioned above, it’s important to reward yourself every so often when you accomplish savings milestones or when you follow your budget for a period of time. This will encourage you to stick to the plan and keep with it.
For example, after a month of meeting your weekly savings benchmark or a quarter of budget success, treat your family to a meal at your favorite restaurant or a night out of entertainment. Just make sure your reward doesn’t bump you off track and put you in the hole.
Make Up if You Slip Up
If you fall short of one of your savings benchmarks or slip up on your budget, hold yourselves accountable. Spend a night in that you otherwise would have spent out on the town. Estimate how much money your family saved by nixing an evening of food and entertainment and put that amount right into your savings.
Eliminate Bad Habits
If you find that your family struggles with sticking to the plan, see if you can identify any bad spending habits or unnecessary expenditures (like too many online subscriptions or pricey double lattes) so you can cut them out.
By keeping track of every dollar spent over, say, a two-week period, you might find unhealthy habits you never knew you had – and how much they really add up.
1st Ed PA Savings and Budget Support
One big factor in most family budgets is debt. If you have accrued a lot of high-interest debt, watching your payments go out every month and your balance hardly come down can be disheartening. That’s why 1st Ed offers low-rate personal loans. They’re a great solution for debt consolidation and paying off high-interest credit cards.
Check out all the info on our site and other great financial resources and services like Bill Pay, financial advising, and even our 1st Ed Visa cards that offer low rates, rewards, and CardNav security, which, on top of other protections, can alert you when you’re close to your set spending limit.
It’s easy to stay on track with these money-saving tips and services from 1st Ed Credit Union.