Fundamentals of Family Budget Planning
Maintaining a family budget will allow any family to gain financial independence (primarily from their addictions and waste of money). Even people with good income sometimes face the problem of lack of money. No sooner had they received their wages than their remnants were dissolved in spontaneous purchases. At the same time, the necessary acquisitions have not been made in full, the current month has not ended, and the cash deficit is already growing.
So whether or not to conduct a family budget is no longer a question. The question is: how to do it right?
Fmily budget forms
Before you start financial control and budget planning for your family, decide on its form. You have three options: a shared budget, a separate budget, or a partial shared budget.
A common or joint budget involves the collection of all funds into a “common pot”, from which expenses are made for all needs. This money is used to pay for utilities, microcredits, food and personal expenses of each of the spouses. This model has been used in many families since the days of the Soviet Union.
It has its own advantages:
- financial transparency;
- convenience in accumulation;
- rapprochement of spouses.
But there are also disadvantages, such as:
- conflicts with an unequal amount of income of each of the spouses;
- inability to make large gifts to each other;
- disagreements over the management of money.
A very popular form of family budgeting for young couples. This form is dictated by modern conditions, modern way of life and modern relationships. And despite the fact that the older generation condemns this model of the formation of the family budget, young people prefer it. True, this model is good when both husband and wife work (or have their own source of income).
General family expenses are divided equally or in proportion to the income of the spouses: one pays for the apartment, the second buys groceries, and so on. The rest of the money the spouses spend at their discretion.
The advantages of this method are:
- financial independence of partners;
- opportunity to spend according to your income.
And the cons:
- difficulties in raising funds;
- disagreements in the payment of common expenses (communal, loans, expenses for children);
- this type is not suitable for spouses with a large difference in income levels.
Part of the overall budget
A compromise form of the family budget. Not all the money earned by the spouses goes to the common piggy bank, but only a large part of them (seventy percent). The rest of the money remains for the satisfaction of personal interests. Or a slightly different version of a partially shared family budget. All the main expenses are borne by the one who earns more, for example, the husband. And the salary of the wife (small) is postponed for summer holidays or for some large purchase.
At the same time, the wife may well spend part of these funds on pleasant trifles for herself. And by the way, in this form of the family budget, unpaid work around the house as a cook, laundress and cleaner should also be taken into account. That is, the wife contributes to the family budget not with money, but with deeds.
Ways to manage a family budget
Having decided on the model for the formation of your family budget, you need to choose a way to manage it. Here you have little choice. There is only one accounting principle: recording income and expenses, planning and summing up. With proper management of the family budget, financial analysis would not hurt, which allows you to identify unnecessary and unreasonable expenses, choose a way to save money and predict profits. Sounds too scientific? Don’t worry, it’s not as scary as it might seem.
First, decide on the tools of home accounting. You can get a special notebook (ledger) and a calculator, but you can also use a computer or you can use free home accounting programs or special online Internet services.
You will only have to fill in the relevant items of income and expenses, and the program itself will calculate everything. After the first two or three months of home bookkeeping, you will understand how to correctly calculate expenses, save money and plan savings.