Financial stress plays a major role in the health and wellbeing of families. It can result in divorce and dysfunction. That’s why it’s important you feel in control of your finances, and have clear trust and boundaries around them with your partner.
This week, financial consultant Robert McMillen shares 7 money-saving tips for young families with us. Use this is a springboard to talk about financial security, boundaries and goals with your partner. It won’t be easy, but if you approach with openness, it could do wonders for your family’s wellbeing. Check back next week for part 2 in our Money and Families series ‘3 Money Habits to Discuss with your Partner’.
7 Money-Saving Tips for Young Families
It’s challenging enough to save money when you’re just accountable for yourself. But when you have a family, pinching pennies becomes much more difficult. It’s safe to suppose that your wallet is bleeding from grocery shopping to locating a pair of jeans that will fit your kids for longer than three weeks. So how can you go from surviving to having financial security?
There are two approaches to saving money: money management, and financial management. Money management is often our go-to, and focuses on the behavioural effects of your decision-making that might have a negative impact on the results of long-term plans.
However, Financial Management is. a great way to develop a healthy relationship with your money as you set up your family’s future. Essentially, it gives you a set of financial disciplines that helps you build wealth growth, protection, and preservation plans. And these are tailored to your individual and your family’s needs, objectives, values, priorities, and risk tolerance. Ultimately, Financial management
- Ensures that financial needs are fulfilled;
- Aids in the management of your income;
- Helps with expenses, savings, and budgeting;
- Ensures financial safety;
- Boost your financial resources;
- Boost your assets;
- Improve your living standards;
- Helps to become debt-free;
Yes, money can be overwhelming. So I have broken it down into 7 money essentials. Follow these and you can reduce money stress if your family significantly.
You should spend less than you earn
Spending less than you earn frees up funds that may be used to make greater debt payments. They gradually fade away, lowering your monthly costs and providing you more breathing room.
Take control of your career
Match your income to your lifestyle while making new purchases. At work, think about non-financial advantages, join helpful career networks, and seek out new possibilities to get the most out of your income.
Have an emergency fund
An emergency fund is simply money placed aside to deal with life’s unforeseen catastrophes. If you lose your work or need to pay for something unexpected, the money will allow you to survive for a few months without getting into debt. Consider it an insurance policy.
Save at least 10%
The 10 percent rule is as easy as dividing your total profits by ten. Money saved can be used to finance a retirement account, create an emergency fund, or contribute to a down payment on a home.
Limit your debt
Debt is similar to bugs. It’s difficult to get rid of after it has infiltrated your life and begun to thrive. The key is to stay away from it in the first place. If you’re in debt, start repaying it as soon as possible. And check your credit report once a year, and pay off your debts regularly.
Every day, the expense of life rises. Investing, on the other hand, is one method to combat inflation and increase your money quicker. You may learn about your alternatives, create an investing schedule, and decide how much to contribute.
Protect yourself and your family
Nobody likes to think about the worst-case scenario, but it’s critical to have strategies in place to safeguard yourself, your assets, and your family if something goes wrong.
Today your goal could be to get-by financially. However, navigating Financial Management with your partner gives you the opportunity to set financial objectives and a different future for your family. So sit down and have that hard conversation with your partner. When you’re on the same page with your finances, everyone benefits.
Check back next week for Part 2 in our Money and Families series ‘3 Money Habits to Discuss with your Partner’.
Is your family splintering from stress? Do you need support to get on the same page and have open communication? Contact Colleen on 0434 337 245 or Duncan on 0434 331 243 for a FREE 10 minute consultation on how we can best help you or book online now.