Comment mieux planifier son budget familialNovember 8, 2016

How to plan your family budget better

Managing the budget when one has a spouse and kids can sometimes be painful. Every time money is spent (on medical bills, power and water bills, short and long trips, etc.), it is important to have a clear vision of one’s financial situation. In order to always make ends meet successfully at the end of the month, it is necessary to keep some things in mind. Here are a few tips to help you plan your family budget better.

How much do you have to spend and how much is actually spent

Do you work full-time? Are you retired? Whatever your particular situation may be, a budget will let you know exactly where you stand financially. It will show:

  • Your income sources (employment, pension, benefits, etc.),
  • Your fixed expenses (power, mortgage, Internet, etc.),
  • Your current expenses (hairdresser, gas, groceries, etc.),
  • Your occasional expenses (short trips, clothes, video games, etc.).

Of course, for a budget to be effective, it must accurately reflect the situation, which is why all expenses and income must be taken into account.

Establish your priorities

Once you have put together your budget, you can set some savings goals to work towards realizing your family projects. That would only be possible if your lifestyle follows what you have budgeted. Make sure to always start the month with enough money to cover your fixed and current expenses. If you end up using credit, take care to have a credit card with a flat rate or the lowest possible interest and fees.

Planning a family trip? Interested in enrolling your children in a private school or simply giving them gifts? Set aside the amount for these activities and build it with monthly deposits (in a separate bank account, if needed).

The cost of raising children

Having compared the budgets of various families for kids’ clothes, recreation, education, and food, the Fraser Institute and the Option Consommateurs have estimated that it costs from $3,000 to $10,000 per year to raise children in Canada (in most cases, the amount increases as the child gets older). Now, more than ever before, it is important to be able to identify unnecessary expenses.

Everyone must participate

The family budget concerns everyone in the family, which is why each member must do their part.  If your children are old enough, make use of this opportunity to start teaching them about money management. Children that can already understand basic budgeting should participate in family budget development. It may come as a surprise, but kids like to be coached, which is why letting them play a role in the budget will make them feel important while lessening the stress for you. To approach the topic with your children in the best way, read Talking about money with children. Finally, if you have questions, please be sure to contact your financial adviser, who can direct you to the best available tools to engage your children in the conversation.

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