How to Manage Family Finances

Managing family finances is important for married individuals to understand. Especially since the needs after starting a family are no longer the same as when they were single. There are many needs that must be met, starting from the needs of children, spouses, education, and many more.

So how do you manage family finances? Here are some ways to manage family finances.

How to Manage Family Finances

Managing finances in a household is something that needs to be done by both husband and wife. Openness about spending will be more comfortable if discussed together, so that each knows their family's needs every month.

With this openness, managing family finances becomes easier. Because you know the amount of needs in the family and how to address them.

Record Daily Expenses

To know how much spending is needed over a month, you can start recording daily expenses.

You can use an app on your phone or write in a special notebook. You can choose to record wherever is easiest to do.

When recording daily expenses, you also need to categorize each expense according to its category. For example, kitchen needs, children's needs, transportation costs, and other necessary categories.

With this categorization, you can identify which expense categories are most important and their amounts each month.

Set a Budget for Each Need

After recording your needs for a month, you can see how much is needed for each category. You can now determine the budget for each category every month. If there are categories where the budget can be trimmed, you can reduce it from the amount recorded over the month.

Each family's categories will certainly differ. But try to always set aside a little for charity or to give to parents and save if there is anything left.

Manage Money When Paid

When payday arrives, you can start managing finances. Withdraw some money from your account and allocate it to the predetermined categories. Leave some for paying bills if you are used to paying bills online.

Some people tend to spend more when handling cash. But they are more frugal when using electronic money. If you fall into this category, you can replace it with another method.

Reduce Unnecessary Purchases

When buying something, consider whether you need it or just want to buy it without any necessity. Don't be tempted by discount prices. Because if you don't buy that discounted item, you will save more. There's no need to spend money on unnecessary things.

Prioritize Important Things

How to manage family finances with one child will certainly differ from families with more than one child. But there is one commonality, always prioritize important needs. Such as paying electricity and water bills, buying basic necessities, or perhaps buying diapers and milk for the child. Because these basic needs, if not met, will certainly affect daily life.

Factors That Make It Difficult to Manage Finances After Marriage

Managing finances is necessary so that income is well distributed for prioritized needs. Especially for those who find it hard to control shopping desires, financial management can serve as a motivation to save.

But managing finances is not always easy. There are several factors that make financial management difficult.

Needs Exceed Income

The many needs after marriage make financial management in the family difficult. Especially if the needs exceed the income. If this happens to your finances, then what you can do is manage as best as you can and always be grateful. Don't let this shortfall be an excuse not to be grateful. Prioritize the most urgent needs and reduce unnecessary shopping.

Difficulty Resisting Shopping Temptations

Is your income high but you still can't manage family finances? The problem may not be the amount of income. But the issue lies in your self-control which is lacking. Being patient during free time is indeed quite difficult. Moreover, the many discounts from various marketplaces tempt you to buy things without necessity.

As long as you still lack good self-control when handling money, then any method of managing family finances will not succeed.

Frequent Small Purchases

Often, what causes finances to leak subtly are underestimated expenses. The amounts may not be large, but they are frequently spent. It doesn't feel like it, but when totaled, it can be quite significant. For example, when shopping at a minimarket, you may find that what you bought is not just the necessary items but also other promotional items. After checking, the total can be quite a lot. If done frequently, it will become a significant unexpected expense.

So when shopping, always try to bring a shopping list, so that the shopping purpose doesn't go off track.

How to Manage Family Finances to Save

Everyone certainly wants their income to be sufficient or even have savings. But it turns out that this is quite difficult to achieve due to several factors mentioned above.

Avoid Being Reckless with Debt

Debt is one of the causes of difficulty in managing finances in the family. Especially if the debt consumes more than thirty percent of income. Unfortunately, many people are reckless with debt. Even with a large income, they still live like poor people.

Friends, if you are indeed pressed to borrow, then pay attention to the size of the income and the debt. Will it interfere with daily needs or not.

Differentiate Between Wants and Needs

Differentiating between needs and wants is actually not difficult. But there are always reasons to make it seem like those wants are needs. So if you are the type of person who often looks for excuses for this, try to refrain from shopping for desired items for at least two weeks. If after more than two weeks you still don't need that item, you can be sure you don't really need it.

Don't Look at Promotions Too Often

Attractive promotions always make you think about shopping under the pretext of "while there's a promotion." Even though that item may not necessarily be needed.

Reducing the view of promotional brochures will make it easier for you to save. If possible, delete online shopping apps from your phone so you won't be tempted by endless promotions.

No matter how much your income is, always set aside something to give to others or to close relatives who are most in need. The amount doesn't always have to be large. Just intend to set aside at least two percent of your income.

Because managing finances should not make you stingy. But rather more aware of spending money on what is more needed. Don't let the desire to save make you stingy and unwilling to share with others. Set aside a little, because giving does not have to wait until you are rich.

That is how to manage family finances without having to be a stingy person. Hope it is beneficial.

Author: Iskael