3 Tips to Optimize Your Family Budget

Truth be told, when basic finance management is taken for granted in one’s home, everything else can easily go downward spiral. While a husband and wife might have been united in love, money management needs to be given utmost priority. This is a non-negotiable so that it does not get in the way of a harmonious home life. It is also one way of training up your children to value a financial wellness in the family. The kind of financial environment children grow up can be pretty impactful as they carry the values we consciously or unconsciously pass down to them, as they grow up.

‘The plans of the diligent end up in profit,
    but those who hurry end up with loss.” Prov. 21:5

The above Bible verse is a good thing to consider. How many stories have we heard about people squandering money, one day-millionaires, and everything else that pertains to bad financial management? As a family, we have this moral obligation and responsibility to raise up children in a financially stable environment. Another reason to consider prudence when it comes to the family’s finances is that this will actually allow you to take control of your money and not the other way around. A stress-free life makes for a secure family environment.

home finance budget

Tip #1: The Use of Multiple Jars

Craig Hill addresses the use of multiple jars in his book, Five Wealth Secrets 96% of Us Don’t Know. In his book, he emphasizes the need to use multiple jars to allocate every monthly income that comes in. This means the husband and wife should agree on the percentage that goes to each jar – e.g. tithe, offering, savings, investment, expenses. While it does not particularly mean a physical jar, in this case, jars would mean different bank accounts with their specific purpose.

When income that comes in month in and month out do not have an allocation, regardless of the influx of money that comes in, the family tends to spend every single cent, thinking that everything is ever available on a whim. This is just one of the values the book shares. It also emphasizes the value of having a vision for your family, considering economic cycles, lifestyle, debt, et. al.

Tip #2: Close the Circle

This is also known as “spending less than you earn.” Being able to identify a definite number where your monthly expenses stops is  a prudent way of jump starting your way to financial freedom.

In case that you failed to get a good start, learn more on how to get out of accumulated debt through the years, and write out a plan and a projection sheet where you are able to foresee the date where you will be debt-free. Set rules and discipline to truly close the circle of expenses, and you will see your family moving forward in your quest to financial freedom.

Tip #3: Be All-In as a Family

Teamwork in the family is not always easy to achieve. This is why starting right is always the key. Having one heart as a family in achieving any goal will make things realizable at the shortest possible time. It is difficult to work on a goal  when you are not be sold out at it with your spouse. To be able to level with each other in having the same goal can be worked out by attending financial foundation seminars intended for families.

Once all three tips are in place, an investment on something that you or your spouse are experts in should be a good idea to consider. This will further your financial acceleration another notch, and can open up an inheritance to your children’s children, which is not a bad thing at all. Bottom line, you limit yourself to the vision you cast for yourself and your family.

3 Tips to Optimize Your Family Budget

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