Saturday 28 May 2016

Managing Money: A guide for busy parents!

Family life is ultimately a blessing, and we should all be grateful for it. One area that it can cause trouble for some, though, is finances. With mouths to feed and bills to pay, this stuff can very quickly pile up!

So how can parents, and families, cope better? What systems are in place to help them in a pinch, and what tips and tricks can they adopt? From loans to luxuries to allowances, let’s take a look at a quick guide to help parents manage money.

Source // Flickr

Pro-tip: Talk to your kids about money!
Assuming they’re at a suitable age, have a chat with your children about money. Help them understand how important it is, and how important it is to save. Tell them where money comes from, and how much your household runs on per month. This way, your children will be more appreciative of how hard you work for them, and the food on their plate.
Coping with sudden expenses
Family life throws a lot at us. Boiler breaks down. Youngest child gets paint all over the carpet. Wind and rain causes a leaky roof. It’s these sudden expenses that can quite often cripple the family finances, so plans must be in place to prevent them.

Firstly, make it a priority to open a long-term savings account with high interest. There are many ISA’s you can choose for this, or you can use a bog-standard account. This ensures you have a pool of money waiting should any problems arise.

For secured personal loans, you don’t even need to have a good credit report. You can borrow the money as long as you have a valuable asset, like a house.

And lastly, look to cut down on luxuries if you need some quick cash. It can be possible to feed your whole family for less than £40 a week for a basic diet. So if luxuries are axed, you can save a small amount of money each week.

Create a spreadsheet or budget note
Visualising the process makes it easier to understand where your money goes. I’d recommend drawing up a quick table or using a spreadsheet formula so you can properly plan your expenses. This is extremely useful if you get paid monthly, too!

Start by creating columns for each expense, like this:
  • Gas and electricity
  • Water
  • Mortgage
  • Phone bill
  • Home insurance
  • Life insurance
  • Council tax
  • TV license
Enter a rough figure equating to how much each usually costs, to get your grand total for monthly expenditure. This way, you have a final figure that you can use to help you figure out how much you have left for food and luxuries.

This figure will help you watch your money by acting as a spending guide. Now, you can divide this by four to see how much you can spend on food per week. Anything left over goes in the savings, or toward debts and spending money.

In short, be frugal, focused and careful with what you buy! Best of luck, and thanks for reading! 

*Contributed post*

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