4 Smart Budgeting Tips For Families To Lead A Debt Free Life
Make a Budget | Personal Finance Budgets
When you follow proper budgeting tips and spend money accordingly, you can have control over how much money you spend in order to fill your needs. By following these tips, you can get back on the right track of managing your money and have a firm grip on your finances. This will help you avoid falling into debt problems and lead a debt free life.
Budget tips for families that can help you lead a debt free life:
Setting the right goals - as much as we all want to be millionaires we all have to start somewhere, and it's better to start small. Just saying you want to be out of debt, or want to have money is not enough. Choose a clear and realistic goal that you and your spouse agree is important for both of you.
You can then decide how much money you need to spend and how much you can save in the long run. You may distinguish your expenses into two kinds, fixed expenses and optional expenses.
Fixed expenses are those expenses which are your basic needs and you will have them every month such as food, clothing, shelter, etc. But, in case of optional expenses such as eating out, buying gifts and spending money on travel, etc., you might find that you can do without them or trim back.
Take care of your health - This is one of the most important budgeting tips that you must include within your family's budget. The medical expenses for routine health checkups, prescription medications and vaccinations should be included within your family's budget. Even if you have health insurance you need to budget for the healthcare expenses that will surely come up and not be covered by your insurance.
You can follow these budgeting tips and build up a health care account where you will save money to take care of these healthcare expenses. But by no means skimp on this because staying healthy can save you tens of thousands over a lifetime plus it will also add immeasurable enjoyment to your life.
Make personal budgeting part of your life - Creating a budget will allow you to "be the boss" of your money. When you have a good budget, it will help you pay off your debts on time and live a debt free life.
By making more than the minimum payment on your credit card debts you will pay them off quicker. Also a budget allows you to spend money only according to your needs; you can then save a good amount of money every month apart from your expenses. The extra amount that you save, you can use to repay your debts and to increase your savings and investments...
By following these budgeting tips properly, you will be able to manage your debt payments on time.
Use cash instead of credit cards - a great rule of thumb is to never buy anything with a credit card that you don't already have the money for. When you have credit cards in your pocket, you make it a habit to use them every time you make a purchase. However, you forget the fact that using cash to purchase things actually helps you spend less.
It is a lot easier to pay for something by sliding that little piece of plastic at the cashier rather than pulling out bills from your wallet. To make paying with cash easier you can use envelopes (see video on Budgeting 101), label them into different categories and keep the required amount of cash in each envelope. This will enable you to have a better idea as to how much money you are spending in each category.
Along with these budgeting tips, you can educate your children as to how they will manage money from the moment they start receiving it. You may sit down with your children and help them out with making a simple personal finance budget, tailored to their age.
You can also suggest to them to save 60 percent of the money from their weekly allowance and spend only 40 percent of the money. Whether they use a piggy bank or a bank account, the important thing is that you help them in creating the habit of saving. Once your children understand the value of money, they will be able to manage their finances efficiently and in turn, live a debt free life.
You will find that if you apply these budgeting tips and make a budget along with your spouse you will find a way to get out of debt and create wealth. If you find these budgeting tips helpful or want to add your own make sure to leave a comment below.