Budgeting tips for your family

Budgeting is an important practice that can determine the financial health and well-being of a family. A family that budgets together is likely to stay together. This is because financial management is an important determinant of the stability and survival of a marriage.

1.  Give every dollar a name before it comes in.

Budgeting every incoming dollar will ensure that you are assigning a name to it and thus reducing the risk of indulgence and overspending. Simply put, ensure your income versus your projected expenses are zero. This will help you to avoid wasting a single dollar.

2.  Do the budget together.

Many couples do not like discussing their finances together-this is a big mistake! Money is important and a failure to manage it well can result in the end of your marriage and love, sooner than you think.

Organize a family budgeting night to ensure that everyone is on the right page. Involving children can enhance their understanding of the practice and also manage their expectations.

3.  Pay off your debt

Prioritizing debt repayments can play a key role in avoiding extra punitive charges and also getting you to tackle this monster.

A failure to manage debt could result in you walking with a lock all your life.

4.  Have financial goals.

All human progress has been the consequence of a goal. Having financial goals could encourage you as a family to be strategic and committed about your efforts.

Ensure that your financial goals are ; smart, achievable, realistic and time-bound. You have to make sure you adopt achievable goals. Hitting milestones can be a powerful motivating power that encourages your family to improve their financial literacy and prudence.

5.  Cut up your credit cards

Many people find themselves addicted to credit cards without planning for them. Eliminating credit cards from the lives of all members of the family can reduce frivolous expenditure.

6.  Track your progress

As a family, it is imperative to track your shared progress and to ensure that everyone understands the current situation and their role to achieve shared outcomes.

7.  Start with the most important categories first.

You may have come across this inspirational video of a person filling a jar with big stones first, before filling in the small ones and the sand.

The presentation is a metaphor for life and highlights the need for prioritizing. When you prioritize, you are able to fund the most important expenses.

8.  Improve the financial literacy of every member of the family.

Financial literacy is crucial in enabling members of a family to make informed choices. When every person understands the importance of a budget and the challenges they face, they are more collaborative and willing to make the necessary sacrifices to enable the family to achieve its financial goals.

9.  Trim costs

Yes, it's not easy, but really do you want to keep an unsustainable budget? As a family you should have a discussion on the things that must be removed to increase savings. Achieving shared goals requires the participation of every person and their willingness to make sacrifices.

10.  Build savings

Creating an emergency fund can prove to be one of the most important things that a person does. When you have an emergency fund, it is easier to overcome the storms that life throws at you.

11.  Enforce financial boundaries and good habits

As a family, there is always a risk of a person being involved in activities that are inconsistent with their aspirations. There must be a mechanism for holding each other accountable with love and seriousness.

12.  Minimize your tax liability

Many families do not know the gaps that are in the tax code that will enable them to reduce their expenses. It is important as a family to research and take advantage of all the opportunities that exist for reducing the expenses.

13.  Assign cash to tempting categories

One of the ways through which to improve financial management practices is to use cash for things such as entertainment and shopping. When the cash ends, a person should know that the activity must end. This discipline will develop over time as parents lead by example.