by Stacy Francis, CFP®, CDFA
I’m a CEO, explained the new client with whom I had lunch yesterday, yet I feel as though I have no control whatsoever over my family’s spending. I never have any money left to invest, store and credit card bills grow larger each month, and my children demand more and more expensive clothes. I’m completely overwhelmed – and exhausted.
I have heard similar stories many times before, so I was able to ensure her that there’s an easy fix to her problem. She simply needs to manage her household budget the same way she manages her company’s budget! These days, many women possess exceptional organizational skills that make them extremely successful in the corporate world. What many don’t know is that these skills are just as useful at home with their personal finances.
If my new client’s situation hits a bit too close to home, follow these four easy tips to get your family budget under control:
- Review spending history. Before you start to make changes, make sure you know where the money is going. To many, seeing their spending habits on paper is a big shock!
- Listen to your employees – in this case your family members. Strategize together on how to save up for expensive items like vacations, and review budgets as well as ideas for how to make them work.
- Make the budget public, leaving as little room as possible for doubt and misunderstandings. The budget should include both goals and ideas for how to make them a reality.
- Review your progress frequently. Gather your family once per month to review the parts of the budget that are working out - and the ones that aren’t. If needed, solicit ideas for troubleshooting. Your spouse and children are much more likely to make an effort to stick to the budget if they were part of creating it!