Does Your Family Use a Budget? It Should
Family budget plans are important for many reasons. If there is debt, a child going off to college, a big vacation to save up for, or simply stress over how money gets allocated, then a budget offers solutions to those problems. Surprisingly, many families do not have any budget whatsoever.
Approximately $10,000 a year from a family budget is spent on items which are flexible in how much can be applied to them. For example, transportation, gasoline, food, and mortgage interest. With a better understanding of where your money is going, and how to allocate it reasonably, a family budget plan can help you to erase debt, save for big life events, and reduce stress between family members.
Here is a family budget example from Quicken, with family budget percentages as a guideline.
- 30% for housing, such as rent.
- 10% for utilities and things like renters insurance.
- 15% for groceries and eating out.
- 10% for transportation costs, such as gas and car loans.
- 10% for student loan and credit card repayment.
- 10% for savings.
- 10% for clothing and entertainment.
- 5% for everything else.
This average family budget can be applied to your annual or monthly income to help you determine what might be reasonable. Creating a family budget should start with knowing what you start with, and what must be paid every single month. If the basics are taken care of, then budgeting can still help with paying off debt more quickly. If the basics are not taken care of, then budgeting can help you determine which of your expenses need to be cut back on to ensure that all of the bills get paid.
Family budget ideas generally revolve around easy money saving tips. How a family can still have fun but spend less money, and how you can make those groceries last longer while still providing your family with nutritious food. Check with popular online blogs to discover new ways that you can save money. Some tips will direct you to search for promo codes and coupons, or use recipes that maximize nutrition and minimize spending. For example, beans are a cheap and delicious source of fiber. Whole fruits and vegetables deliver optimal nutrition, and when in season are very affordable.
Family budget plans can reduce financial stress, make you more confident in your finances, and help you to pay down debt more efficiently. Start with analyzing what your expenses are, and how they whittle away at your income. With everything mapped out you will be able to see where too much money is being spent, and where there are opportunities for savings.