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4 FAMILY BUDGETING TIPS THAT WORK IN REAL LIFE
- 27 May - 02 Jun, 2023
Staying flexible is essential for successful family budgeting, as it allows you to deal with irregular costs as well as unexpected challenges, such as sky-high grocery store prices or rising interest rates. According to financial experts such as Snyder, by using creative methods to dial in a budget and cut costs in some areas, you can often find ways to spend on what is most important to you.
Follow your own rhythm rather than rules
According to Severine Bryan, an Atlanta-based personal finance educator and coach, a budget must be flexible and constantly adjust to challenges. One of the most common mistakes people make, she says, is believing they must adhere to a rigid approach, such as the 50/30/20 budget. Bryan, who has a doctorate in business administration, prefers spreadsheets to track her spending, but her college-age daughter prefers a more creative approach with visuals and graphs. They each use their preferred method and, when necessary, communicate about spending. "It has to be a method that you enjoy using so that you want to use it all the time," she explained.
Consider variable expenses
"The default view of budgeting is annual, but I think that can be frustrating because it's really hard to have a perspective on your entire year in one sitting," said Charlie Bolognino, a certified financial planner in Plymouth, Minnesota. Instead, he suggests beginning with a month-by-month approach and then gradually adding in less predictable costs such as holiday expenses. "We'll never catch them all, but we want to reduce surprises as much as we can."
Bolognino adds that, while major expenses like housing and child care are frequently fixed, other costs, particularly food, fluctuate much more. While this means that food costs can be high during months when you host dinners or go to restaurants, it also means that you can cut them with shifts like meal planning and grocery store discounts.
Team up with your partner
Being in sync with your partner is an essential part of the budgeting process, albeit one of the most difficult. Instead of rehashing a money argument, Bolognino suggests planning your future together and getting excited about shared goals. Those conversations, he says, can strengthen a relationship because "it feels like we are aiming for the same thing." In his case, he stopped criticising his wife's coffee-buying habit when he realised it wasn't costing him much.
Determine what is truly important
Cara Macksoud, CEO of Money Habitudes, a money personality assessment company, said she, her husband, and their five children first decide what expenses are "nonnegotiable" together. Aside from food, this could include costs for sports or private lessons, for example.
Macksoud then suggests meeting those needs creatively by selecting less expensive options. If going on vacation is important to you, perhaps what is most important is spending time together away from everyday stresses. Her family, who live in Venice, Florida, decided to take a road trip together, which was partly planned by her children based on Instagram photos.
"We did crazy, off-the-beaten-path things," she said, referring to a trip to New Mexico's White Sands National Monument. They had a memorable (and Instagram-worthy) day riding an air mattress down the mounds of white sand.
Utilise community resources
Erin Voisin, a certified financial planner and managing director at EP Wealth Advisors in Torrance, California, claims to have saved hundreds of dollars on toys for her children by shopping at local moms groups and "buy nothing" groups. “I don't want to pay full price, so I join groups that post flash deals or giveaways," she explains. "Prioritise the roof over your head, food, a way to get to work and utilities," Bryan said. "Everything else will fall into place."
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