Keeping the rent paid, the utilities on and food in the cupboard can be an exhausting process, especially for families who have suffered a job loss or a reduction in hours due to the recent problems associated with the lackluster economy. When even more pressure is added by credit card bills, car payments or student loans, many couples begin to lose focus and hope. Whether you have suffered some type of job loss or would just like to find a way to take control of your family's financial destiny, here are some tips to help you get started.
Get to Know the Enemy
Avoiding any type of problem seldom works out well and this is especially true when dealing with financial issues. Hiding bills from your spouse or partner or refusing to open them only prolongs the problem and allows it to become even larger and more terrifying. Instead, follow these proactive steps to develop a workable budget strategy for your household.
- Invite your spouse or partner to join you at the kitchen table with a notepad and calculator for a budget meeting and strategy session
- Agree to make this weekly budget meeting mandatory, and insist that the kitchen table becomes a no-blame, no-yelling zone where both partners have a voice but all conversation is to remain professional and polite
- Examine each bill, looking for any errors that may exist, then prioritize them remembering that food, medications, housing, utilities, transportation and emergency savings are ranked as the top priorities
- Start a written budget, including current income information and debts to be repaid
- Enter payroll dates into the budget and the amounts of pay expected on each
- Allocate available funds and a percentage of future funds to ensure that the basics are always covered in the budget, then determine how any leftover amounts will be divided among the remaining bills
- Update the budget each week with any new information to help you remain focused on the goal of making financial progress
Eliminating Unnecessary Spending
One of the most beneficial lessons that come from openly and honestly examining and discussing the family budget is understanding what spending is necessary and what is not. The best way to learn this is for each partner to jot down all expenditures each day in a notebook or enter them into a smartphone app or computer spreadsheet that can be reviewed at the weekly budget meeting.
This can be a very eye-opening experience. For instance, a $5 coffee or fast food snack just 5 times per week can seem trivial at the time, yet it adds up to a $100 expense each month and more than $1200 over an entire year. Since statistics provided by the United States Department of Agriculture suggest that the average cost of a healthy diet for a family of four averages $146 per week or more, finding a way to eliminate just one $5 expense per day could potentially pay for more than 2 months worth of groceries for the entire family.
Dealing With Emergencies
Establishing a modest emergency fund is the key to helping families deal with emergencies without incurring additional debt. Set aside a small amount, even just $5 or $10 dollars per week and make an agreement that it will not be spent unless a real emergency occurs. Decide together that a hankering for pizza is not a true emergency, while repairing the brakes on the car or covering an emergency dental care cost is.
If a crisis develops before an emergency fund is in place and you are facing a situation where you cannot pay the rent, buy food or keep the utilities on, it may be necessary to consider asking for help from family or using a reputable payday advance lending service such as Payday Express. Consider these loans as minor setbacks on your journey toward a better financial future, and make sure they are paid back promptly.