It is 2024, and N5000 can no longer cook a good pot of soup. Running a household is no longer easy. Before you think of your children’s school fees, you need to take care of feeding, water, electricity bills, fuel, and transport, among other things. You still have to worry about wants like buying a wig for your wife or boxers for your husband (for the ‘king is born type’ of women).
Now more than ever, having a budget for all your family's needs is crucial. In this article, we explore how to create a family budget.
What is a Family Budget?
You must have heard about budgeting, which is having a financial plan. A family budget is simply a plan for your household income and expenses. A family budget should be drawn every month, depending on your family income.
5 Reasons Why You Need a Family Budget
A family budget is important for different reasons. Here they are
Monitor Your Income and Expenses
A family budget helps you and your partner monitor how much you spend on your needs and wants. You will know how much your family spends on essentials like food and diapers. You will also know the extra income, like monetary gifts, that enter your family's purse. This will help you guys plan better.
Paying off debts and bills
With a well-structured budget, you can pay your kids' school fees and other bills or debt easily. Even if a bill or debt can’t be paid off in a month, you save monthly for it. For instance, you can set aside money monthly for your children’s school fees. The Babybox feature of the Jollof+ app helps you do that.
Secure a Bright Financial Future
Consistent family budgeting will help you and your spouse achieve both short- and long-term financial goals. You can save towards a goal like buying a house. You can also invest or buy shares.
Reduces Stress for You and Your Partner
You and your partner don’t have to worry about finances. The budget helps you understand where your family is financially so you can build.
Teach You and Your Kids Financial Discipline
When your kids see how well their parents manage money, they learn how to manage money better. You can also teach them about financial literacy and the importance of planning.
5 Steps on How To Create a Family Budget
Spell Out Your Income
You and your spouse should start by documenting all your sources of income: From salary to side hustles, to extra income like gifts and bonuses.
List Out Family Expenses and Debt
How much are your debt, bills, and expenses? Record all debt and costs and subtract them from your total income.
Remove Your Savings from Your Income
After you and your spouse have removed your expenses, remove your family savings. Don’t fall into the trap of spending on wants before you save. You can even automate your savings with the Jollof+ app. Download the app, set up the automation and relax as your savings leave your account every month.
Add Fun Things To Budget
Don’t forget to add fun things like treats and family outings to the budget. This is important for your family’s well-being.
Plan for The Next Month
It helps to have a budget for the next month in advance. This way, you know recurring expenses and plan for them.
Tips For Having a Good Family Budget
Talk about Money
You and your partner should discuss about money, your financial goals, dreams and life. This will help you and your partner plan a budget that aligns with your needs and dreams.
Make a Priority List
A need might be important but might not be important right away. So focus on immediate needs.
Know your Needs and Wants
Needs might differ from family to family. Define what your family needs per person and include that in your budget.
Track Your Expenses
How much you are spending and how well the budget is working, so you can tweak according to what is working and what is not.
Combine Your Finances
For those of you who think his money is our money but your money is your money, this will affect the whole financial situation in your home. In this economy, two pockets are better than one. Combine your finances to secure your family’s financial future.
In The End
Whether you want to cook a big, sumptuous pot of Onugbu soup or purchase the latest phone, have a budget that meets the needs and wants of your family. Invest in financial stability so that your family can be happy.
