Combining money and family can create a sticky situation fast, especially when one side has been making unwise decisions. I tend to avoid giving specific advice in family settings as most members of my extended family know my outlook. But I will offer my help when someone asks.
I've had numerous conversations about money matters with one family member (whom I will lovingly leave unnamed). This loved one recently graduated college and is wondering where his money is going each month. After discussing his obligations, we determined that he has roughly $800 to $1,000 each month after everything is said and done. He believes budgeting can be messy and doesn't want to try it, but he hates feeling like he's broke at the end of the month. Over the past several months, I've helped him get a grasp of what works best for him by breaking down the benefits of budgeting into three steps.
I am trying to get him to feel empowered, rather than broke, at the end of each month. Same for you. Whether you call it a budget a personal spending plan or something else, create something for your personal situation
Know What You Earn
While it might seem obvious, you need to know how much income you make each month. This should include what you're bringing in through your day job and what you make in your side hustles.
By not knowing what you make each month, you're like a mechanic trying to fix a car without all of your tools. You might be able to get part of the problem fixed, but you'll be held back. With finances, you want to know what you're going into each month with so you can make informed decisions.
Know What You Spend
The next vital step is knowing where your money is going each month, like:
Cell phone bill.
And much more.
%VIRTUAL-article-sponsoredlinks%You may feel like you need to track every penny over a long term to understand your spending tendencies, but that might not be true, and if such a task stymies you from taking any action, the back of a napkin is better than nothing. Short-term tracking of spending works fine; again, it just depends on your personality and what's going to help you.
If you're lost about starting, options include Mint, Manilla to plain old Excel. Find what works best for you and run with it. Many of these programs are free or very reasonable in price.
Know What's Left Over
This is where my family member got lost. He had no idea what he had left over at the end of the month. Coupled with some mindless spending, he was wasting his hard-earned money. The money you have at the end of the month is your money -- for paying off debt, saving for retirement to whatever else you want or need.
The key is having a plan. This will help you avoid mindless spending and force you to come up with goals for your money. After all, who doesn't feel good after reaching a goal? You just need to determine your financial goals and how your money can best reach them.
My family member was concerned that he was spending too much on items that provide him no value. After determining what he has left at the end of each month, he now has comfort knowing what he can spend and what he needs to put in place to reach his goals. That really is the best of both worlds.
John Schmoll is the founder of Frugal Rules, a finance blog that regularly discusses investing, budgeting and frugal living. He is a father, husband and veteran of the financial services industry who's passionate about helping people find freedom through frugality. He also writes about growing your wealth on Sprout Wealth.
12 Ways to Save Money on Food
To Feel Better About Your Finances, Try This Simple Plan
This advice applies to adults and kids alike. Plan out your shopping list before you head to the grocery store so you’re not tempted by impulse buys, and let any children along for the ride know that you plan on sticking with that list. Small expenditures add up to big money, so try to avoid giving in to any last-minute requests.
If your children continue to insist that you purchase their requested items, then ask them to bring their own piggy bank money. Remind your children they are only allowed to pick something they can afford. It's good practice for grown-up budgeting.
You might not have 20 hours a week to scour multiple publications for the best deals, but if you focus on searching for online coupons, you'll end up saving just as much. Search online for products with the word "coupon" afterward. For instance, if you're looking for Cascade dish soap, search for "Cascade dish soap coupons."
To make sure that you don't waste money on impulse buys, schedule your shopping around paydays. The day or day after you get paid should be your shopping day. Before you go shopping, make a list and make sure it has everything you'll need until the next shopping day on it. Now make a commitment to yourself that you will make what you're going to purchase last until the next shopping day.
Stocking your freezer with frozen meals can help you save money on lunch, since they cost just about $5 each. It can even be a healthier option because they help you practice portion control. Just make sure you're purchasing meals that have no preservatives, and watch out for sodium levels.
Don't waste your time making a sack lunch every day. Instead, prepare a week's worth of lunches on Sunday, and your body will thank you for the extra 10 to 30 minutes of sleep you'll gain each night. If you cook one big meal on Sunday, make sure it's easy to change up throughout the week. Chicken, rice and vegetables all cook quickly and taste great with different sauces and cheeses.
Most families throw away so much food on a weekly basis. A better idea is to turn your dinner leftovers into a lunchtime feast. Apps like BigOven help you use your leftovers to make yummy, new dishes. All you have to do is enter the ingredients you have, and the app will show you different recipe options for your leftovers. You'll save money using food that would have been thrown out.
If you know you have $400 to spend per month on your food budget, that's roughly $100 a week. Whether you shop once or twice per week or use cash or credit doesn't matter as long as you stay within your spending limits. Just be sure to only spend the amount you allotted per week.
Keep your shopping list in a set location so all members of the household can access it. Write estimated prices of the items you are going to buy next to each item on the checklist. It can serve a dual purpose as a price book you can use to guess how much you will spend.
If you've ordered from the kids menu at a restaurant recently, then you know how big the meals are – they're almost as big as meals for adults, and they can cost up to $10 each. If you have multiple children, an easy way to cut down on this expense is to have them share a meal. Not only does this lower the cost of feeding everyone, but it also cuts down on food waste.
Most stores are open late, and without the distraction of announcements, people and maybe even your kids, you can have your own Zen moment. When you are clearheaded, you're more likely to zone in on what you really need and leave out what you really don't. Plus, it's easier to give the cashier coupons without causing any delays for the people in line behind you.
We are a society consumed by all sorts of apps, but if you want to grocery shop, save money and still be lazy, let Favado, an app created by Savings.com, do the work for you. The app will tell you about items on sale from different stores, and if there is a store coupon or manufacturer coupon, it will also let you know that too. (Of course, you can just use it to scan the weekly ads to keep things simple.) And if you're already glued to your smartphone, it's easy to incorporate into your shopping routine.