There can be no more joyous and challenging adventure as raising a family.
Amidst the highs and lows, there is a strong responsibility to be prepared for your future. Your finances play a huge role in the stability you provide.
But where do you start?
Being financially sound is a mindset. It’s something you commit to day in and day out for the security to live how you choose. It all starts with planning.
There are many great ways to start taking your future into your hands, and a clear and concise budget is the vehicle to get you there. What makes a great budget? Here are some tips that can help lay the foundation for financial freedom
A family is a partnership. It takes clear, concise communication with your spouse to be successful.
Lack of clear expectations and communications can derail a budget before it even begins. Talk about it. Be open and honest. When you’re on the same page, making sound decisions becomes easier.
Compromise on plans and allocations of money. Successful marriages can fall apart due to concerns over finances. An estimated 22% of marriages fail due to monetary concerns. Transparency will go a long way towards creating a strong partnership.
There will be trials along the way, the last thing you want is to have internal strife working against your family. Work as a team, overcome challenges together.
Write it down
The simplest of steps is often the most challenging for new planning.
Record everything. Every source of income, every expense, every spending plan, every additional hurdle. At a glance, all the information will be at your fingertips.
There are many great options available to assist in keeping track of your budget, many of which are free and easy to use
- Intuit Mint
- You Need A Budget (YNAB)
- Your current bank
Using these tools takes the setup out of recording your budget, allowing you to focus on inputting all information easy to see at a glance. They also can provide visual snapshots and periodic statements for a recap.
Strong savings plan
It’s a simple word, but a complex principle. There are many layers to saving, all of which can help your family achieve their goals.
Saving money, by reducing spending, can power up your income and leave you with more money at the end of the month.
Saving money, in the absence of spending, can bolster a strong cash fund that can be used to provide security. An emergency fund, with 6 months of income, will take care of any urgent bills or needs without the need for credit.
There are other ways to accumulate cash to supply an emergency fund. Your annual tax refund can be a great spurn to a savings account, and many families choose to save this way. They can also be used to eliminate debt, relieving stress.
Perhaps you don’t have a refund coming your way but want to address some lingering debts? There are many loan programs available for a quick infusion of cash. Consider a title loan, leverage the equity in your car to pay down credit or other large bills
Sound financial planning is a multi-step process. With determination and strong planning, along with day-to-day discipline, you can provide a foundation that will secure your family for years.