Setting a family budget plan sounds far from complicated. After all, you just set a cash amount, stick with it, and everything will turn out fine, right? Oversimplification of family budget plans are the root cause of why families fail to achieve the financial goals they set out for. People cannot effectively cover all major and minor expenses, which result in surprises and setbacks.
How To Set A Simple Family Budget For Everyone
Food and water are both basic necessities for every family. Set aside a percentage of your income for monthly groceries, with the general consensus being 5 to 15 percent of your monthly income. According to the Bureau of Labor Statistics, the average household family budget for food in the United States is 12.9 percent.
By planning meals in advance, you can purchase food in bulk, which saves on cost per item and gas from back-and-forth trips to the grocery store.
Distribute Allowances on a Monthly Basis
If a monthly allowance is too big of a cost on your family budget, you can choose to do a shorter time frame schedule, such as bi-weekly or even weekly. Give your spouse and/or children their allowances for that time frame and let them manage the cash on their own. This not only lessens the burden of what you have to keep track of but also teaches them values and techniques on how to best handle cash.
List Your Transportation Costs
Going to and from place to place can take its toll on your income more than you might realize. Transportation cost isn’t just about monthly car payments, but gas, maintenance, and repairs as well. If you take the bus or train, look at the cost of buying a day pass versus the cost of buying a monthly pass. Most of the time, the latter is cheaper and avoids having to stop by the ticket booth frequently.
It will cost some initial investment, but financial planning for the family is a worthwhile investment that pays off in dividends over time. Family financial planners can review your investments and insurance policies to assess its compatibility with your circumstances and goals and, if needed, make corrections to better achieve that predetermined path.
Frugality is an attribute that isn’t innate or limited to a handful of people. Any individual or family can hone the attribute into a habit that they can use on a daily basis to improve their quality of life.
Guest Post: Kara Masterson is a freelance writer from West Jordan, Utah. She graduated from the University of Utah and enjoys writing and spending time with her dog, Max.