How To Set up a Family Budget

MONEY AND MARRIAGE MASTER CLASS: LESSON 20

How to set up a family budget

Bisi Adewale

Don’t make your budget too cumbersome that you yourself will not understand it and get frustrated in the process, so keep it simple for yourself. Most book written about family budget are too technical because most were written by accountant who are not family minister so they don’t really consider the work-ability of their write up among every day couple. So as an accountant cum family minister, am trying as much as possible to simplify budget preparation in the family.

• Having known your total income
• Having been able to know areas where you’ve been spending your money
• Can I suggest that you trail your spending for three months, this you can do by recording all your expenses for the first month and total them. Do it for the second and third month, now check what you’ve been spending on all categories.
• Check areas where you need to improve, which monthly fixed payment you can eliminate, check phone bills, transport, miscellaneous.
• What expenses can you eliminate totally, what can you do to reduce these expenses and release money for savings and investment?
• Now sit down and allot money to each area like housing, child care using your expenses in the last three months to know how much will be reasonable for that cost center.
• If you are just starting, you can create an envelope for each cost center and write the name of the cost centre on each envelop. You can write debt payment on one, housing on other. Anytime you want to pick money for that cost centre, pick it from its envelop.
• If you operate by cheque or card, anytime you make a payment or draw a cheque; record it against the cost centre that owns it.
• After one moth check your result.
• Don’t be despondent if you fail and huddle things together; practice make perfect. Go ahead do it the next month.
• To make things easier for you, you can give standing order to your bank for fixed payment, union dues, savings and investments,

To be sincere with you, I wish I can make budget preparation in the family easier for everyone, but you need to know that this is the simplest way we can go, that is why we are not talking about those technical things which budgeting involves which do put off more than 90% of people from maintaining a budget. But remember that you can’t really keep a budget without keeping record, you must but don’t allow that o put you off nobody is putting a gun on your head.

A GOOD FAMILY BUDGET

• A good family budget has to be created and maintained by the husband and wife
• Must be fair to both
• Must be prepared ahead of time.
• Must be simple for the two of you to operate
• Must be flexible enough to give room for emergency. Must be rigid enough to be stick to in the absence of emergency.
• Must give room for allowance or “pocket money” for both

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