Today we will tell you how to plan a family budget so that there is still money for everything. Have you heard of off-plan planning technology? Before you start planning your family budget and distributing money according to expense items, you need to know exactly:
1. For what period will the budget be drawn up (it can be planned for a month, quarter, year). It is most convenient to draw up a budget for one month, because most people get paid monthly.
2. What income will you have – how much money and from what sources you get for this period.
3. What expenses you will have – how much money and on what you are going to spend money during this period.
In order to know this, you must definitely start keeping a record of family finances – i.e. to fix all the money that comes (income) and leaves (expenses). What is needed for this? Nothing special, you just have to follow three very important rules.
Rule #1. Pay yourself first!
The first thing to do always and with any income – as soon as you receive the money – at least 10% of the income should be saved.Do not spend it under any circumstances. You pay this money to yourself! This is your family capital that will grow and multiply!
The main financial problem for most families is the lack of cash savings. People cannot make savings simply because at first they pay all their expenses trying to save what remains. But, as a rule, it doesn’t come to saving; everything that is earned is spent. Therefore, it is necessary to develop a basic financial habit – from each receipt of money you need to save 10% and live on the remaining 90%. Most likely you will not even notice that you had these 10%.
It is recommended to immediately transfer this money to the bank for a replenished deposit. This is your airbag for future!
Rule #2. Prioritize spending before starting paying
It is necessary to determine what is important for the family and what is secondary. It is necessary to distribute the money first for important and urgent expenses, and what remains – for unimportant and non-urgent ones.
The procedure is as follows.
- Make a list of the importance of expenses.It is necessary to write out of all items of expenses in order of importance for you from the most important to the least important. At the top of the list, almost everyone will have compulsory expenses – vital expenses that ensure a living wage for the family (payment for an apartment, utility bills, food, phone, internet, necessary clothes, shoes, household chemicals, transportation, pocketmoney).
- Allocate 5-10% of income for unforeseen expenses.As a rule, in every family there are all kinds of unforeseen situations that require expenses and for some reason they are always extremely important and urgent! These include payment for urgent treatment (purchase of medicines, expenses for diagnostics, consultations and treatment), repair of housing, automobiles, clothes and shoes, and other expenses that cannot be foreseen.
- Save money for planned expenses.In addition to unplanned expenses, everyone also has planned expenses that are not mandatory, most often such expenses are tied to a certain date and their amount is known (gifts for birthdays, holidays, holidays, large purchases).
- Consider the remaining money and distribute it to the remaining non-urgent and optional expenses.Generally, these are desirable costs. This is something that you would like to buy, but not vital (fashion clothes and shoes, jewelry, visiting restaurants, theaters, buying books, hobbies.) These are expenses for pleasure, entertainment and hobbies.
Rule #3. Manage expenses with cost savings and optimization
Saving is the reduction of costs and the elimination of unnecessary expenses. The goal of saving is to get more for less. You need to learn how to save by using various methods – buying goods and services at discounts, at better prices, due to a more rational use of resources, refusing unnecessary things and services and bad habits, etc. At the same time, it is not necessary to radically change your lifestyle, your character, and develop stinginess and greed.
If you are short of money and you do not want to touch your saving funds, there is a possibility of contacting ending companies online or off-line. Explore the proposals of several lenders and choose the most suitable for your case.
Cost optimization is a reasonable redistribution of expenses by items with minimal losses in the level and lifestyle. If you don’t have enough money for some expenditure item, but you can not refuse it at all, if little by little cut down other expense items in its favor, this will allow you not to infringe on any necessary needs and desires.