A family has so many different costs and expenses, as well as various incomes, that it can be very difficult to keep track of it all. With inflation continuing and wages stagnating, it is getting more and more difficult for families to keep their financial heads above water. It is essential that you stay on top of your finances and know exactly what is coming in and going out, and when. Here are some tips on how to keep your family’s finances organised and healthy.
Make a list of your incomes
Your income might come from a variety of sources. You probably have a job and, unless you’re a freelancer, you probably receive a set amount of salary every single month. If you have a partner who is working, then you should also note down how much he or she receives every month. You might also have some other income sources. Perhaps you own a house and you are renting it out – the rent that is paid to you will be part of your monthly income. You might also have investments which provide dividends regularly. Whatever is coming into your account, you need to note it down.
Make a list of all expenses
Sit down and have a think about the money that has to go out of your account each month. List the items in amount order. You’ll probably start with the rent/mortgage at the top, then go down to car expenses, food, utility bills, and then there will be money for entertainment, the children’s pocket money and other smaller expenses. You will have a rough idea of how much you spend on toys, clothes, films, games and whatever other hobbies your family members enjoy. If you do not know the exact cost of such items, then the next tip will be relevant.
Keep your receipts
That might seem like an incredibly boring thing to do but personal finance is a bit boring – accept it. Keeping your receipts of your shopping means that you can see exactly how much you are spending each week. Receipts are essential for less regular expenses, like going out to restaurants, buying clothes, toys or video games. It might seem like a nuisance trying to remember to keep receipts and then holding onto them but, luckily, technology has that covered. There are now apps available that allow you to use your smartphone to scan receipts, automatically recording the expense and noting it down into a budget. Apps like Wave make it easy to scan receipts and keep track of how much you are spending each month.
Make a budget
Once you have made a list of all of your incomings and outgoings for each month and you are sure that you have accounted for everything, then you can put them together to create a budget. Your budget should add up all your expenses and all of your incomes so that you can see exactly how much money you have left over. There are plenty of budgeting apps that can make calculating and keeping a budget easier.
Take a look at your budget and see if anything pops out at you. Maybe you are spending a large amount on going out to eat, or maybe your phone bill is huge or, perhaps, too much is being spent on clothing. Take a look at this average household budget in the UK and see how it compares with yours. The 50/30/20 ratio is a good rule to follow, generally. It means 50% of your income should be spent on needs, 30% should be spent on wants and 20% should be saved.
Look out for ways to save or get money back
If you have looked at your budget and you have made cuts to various expenses but still find yourself feeling the pinch, there are various ways that you can make more savings and get money back. Look out for introductory offers at retailers to see if you can get vouchers. Additionally, you might have been mis-sold PPI. If you think that is the case, then you can get compensation from the company that sold you the policy. For example, you could get thousands of pounds back with a Halifax PPI Refund.
Keeping on top of your finances is hugely dependent on knowing exactly what is going in and out of your account. Once you know that, then you can try to reduce your expenses if necessary or find a way to increase your income.