The Secret Steps To Preparing a Solid Family Budget
Are you someone who wonders at the end of a month about where all your money went? If you’re the only bread-earner of your family and if you’re losing the battle to eke out your salary to make ends meet, you’re perhaps in need of a solid financial budget. There are some family financial planners who stress on the dire necessity of following a family budget in order to avoid falling in high interest unsecured debt issues. If there is an overwhelmingly large amount of debt borne by a family, they need to run for debt settlement help. This can actually be a good way of tracking the income and expenditure of a particular family and staying away from debt. Read on to know about the following steps that can make you a leaner and a meaner person.
Your goal must be to have a specific goal: When most people think of crafting a budget and following it, they have a particular goal in mind. The goal may be a vehicle or even a much desired holiday. If you have such goals in mind, chances are high that you’ll have the right amount of dedication to set up and follow your budget throughout the month. If you have such achievable goals, make them visible. Write them on a piece of paper and stick them on your wall so that it keeps on staying within your visibility.
Keep a track on your monthly expenses: Jot down all the expenses that you make in a particular month and track them for a 3-5 month period. By looking at the receipts, you will be able to know where your money is going and whether or not there are any mild fluctuations in the expenses of a particular month. Make changes whenever necessary and evaluate them to measure the results of them.
Lay all your expenses out: Eminent financial experts ask people to divide their monthly expenses into 4 different categories like housing, work, living and personal. The mortgage payments, rents, taxes, home insurance payments, telephone and internet access bills will fall in the housing category. Transportation costs, day care, parking costs etc will fall into the work category. Groceries, clothing costs, insurance bills, prescription drugs fall into the living category and the personal category includes entertainment, CDs, education expenses, donations and other costs.
Weed out all the unnecessary items: Tracking your expenses will enable you to identify things that give you a bang for a buck and the black holes in your family budget. Most people least understand how unwittingly they’ve counted luxury items among the fixed costs. Consider buying a bottle of wine once a month and also downgrade your cable package to basic from premium. Parking fees are also unpleasant disbursements that unnecessarily add on to your monthly expenses.
Save 10% every month as this is the solution: The most effective solution to your financial contingencies would be saving at least 10% of what you make in a particular month. Keep saving money as in your contingency fund and make use of it when you feel you’re in dire need of money.Use debit to leave behind debt: Though it may seem to you that credit cards are extremely convenient to use, yet you must be aware of the fact that they are just like an artificial cushion. Instead of credit cards, use debit cards so that you can easily access funds and stay within your limit.
A family budget will force you to take a look at where your funds go. If you’ve already overspent in one category, a budget can immediately track that area and you can take steps to mend it carefully. Though debt settlement companies are there to help you settle your debts and make them manageable, yet it is always better to take the precautionary steps to stay sure about your future.