INTRODUCTION
“The average family exists only on paper and its average budget is a fiction, invented by
statisticians for the convenience of statisticians.”
Sylvia Porter
Unlike the quote provided above, seemingly reflective of general opinion on family budgets
today, we will attempt to take a much more positive approach to budgeting, as a family
oriented, user-friendly, financial management and planning tool and life-enabler.
However, when reflecting on family budgeting and inquiring as to why not more families are
actually using it, it becomes self-evident that similar skepticism runs rampant and deep in reality
and society, even globally so.
Once you start probing family budgets, expending time and energy researching the subject
in-depth, it becomes quite clear, that most families are caught in a vicious, almost never-ending
cycle of “What comes in must go out.”
Most families might feel that budgeting is a futile effort, unnecessarily burdening them with
thoughts and ways, to go broke methodically and slowly, without the creature comforts and
indulgences of our human modern-day society.
Others might voice that they feel as if they are merely throwing money away, in a never-ending
and dizzying spiral of spend, spend, spend. People are getting deeper and deeper into debt, no
matter how hard they try to get out of it. Questions are then raised : How do we stop these
courses of action? How do we change the thinking around family fiscal discipline?
Put simply, in “How to set up a Family Budget”, we focus in on how to empower families to set
up better, more realistic budgets, stick to them and celebrate their successes (and learn from their
failures!)
Families eventually do have a monthly surplus, see their savings start to grow, consolidate their
debt, set aside discretionary funds and personal allowances, build their wealth and become more
aware of their pro-active involvement and responsibility regarding their lives and finances. This
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is when excitement builds and fundamental thought patters as well as spending attitudes are
changed.
Budgeting is seen as an accurate measurement of success when significant behavioral
transformation is taking place on the landscape of the family budget, spending habits and
financial patterns we observe over time!
Do you ever feel that you do not have enough cash at the end of the month to pay bills, buy
necessities of life? Are you barely making a dent in your credit card debt balance, no matter how
hard you try?
Here is a reality check for all of us: if we choose to spend it, it is gone for good. We cannot
spend it on anything else. Are you perhaps worried about a nest egg for your golden years or
savings for early retirement? Then you have arrived at a source that can provide some prudent
tips on how to start, finish, implement, stick to, revise and refine a family budget.
The family budget is a dynamic process, even more so than a mere static work-product, result,
process-outcome or document. It will, can and should change over time. It becomes a barometer
of a family’s fiscal circumstance, resources and health.
Maybe budgeting is not as much about reflecting on what you cannot have, but more about
thoughts on how to stretch, invest and spend your earned dollars more wisely. In short, it is about
making your money going further.
This quick-reference how-to guide was developed to assist you with setting up your own
personal, household and family budget, to help you with all of the above and more!
A couple of general money-savings will also be provided in these pages. There are also thoughts
and spending patterns that need to change, in order to become fiscally more disciplined and
many techniques, attitudes, habitual behaviors that we need to un-earth, evaluate and possibly
change, before you even start budgeting.
For example, being a bargain hunter looking for good buys, cutting down on careless spending,
being on the lookout for careless credit card spending and letting the person who handles money
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best in your household actually take care of it, are all good examples of what we mean.
For most households, a budget is no more than a spending plan. Any spending plan can help you
see where your money is going. It fits your spending to your income. It reflects how we get the
things we want and need most, while being ready and prepared for bills we must pay every
month.
For most families it is simply about making a budget you can live with and stick to easily. It is
not a difficult exercise, but one most people fear, avoid or dread because of the unknown and
perceived complexity of it (sometimes wrongfully so!).
Part of the goal of this guide is to demystify family budgeting and highlight an easy
systematic process to setting up a quality family budget.
Many things actually drive our expenditure. We choose to spend our money on things we value,
need, prefer or consciously choose. For some it is clothes, for others it might be something as
simple as taking that yearly vacation.
Whether you are making financial decisions for yourself or your household, you might have to
make some serious choices and adjustments regarding your financial freedom and situation.
“How to Set up a Family Budget”, is a quick-reference, easy, how-to guide, meant to take you
through the typical, who, why, when, what, where and how questions typically asked when
considering fiscal planning for the household and or budgeting in general for your family need,
means and circumstance, now and for the future.
Budgeting is not just about restricting spending and living a cheapskate life. It is about
insights, wisdom, informed decisions, action and sustained discipline when it comes to your
household financials.
This guide will invite you to learn more in these pages about systematic budgeting. It focuses on
practical application and zooms in to apply these “best practice suggestions” in your own home.
It empowers you to put together a dynamic, financial plan that suits your pocketbook, means and
circumstance.
Financially speaking, assess quickly where you think you and your family are today.