8 Incredible Tips for Creating a Family Budget

Effective financial planning does more than just safeguard your future finances. The stress caused by financial troubles can have a detrimental effect on both your mental and physical well-being. It's your responsibility to establish a significant budget—and adhere to it faithfully.

However, you aren’t alone if you find the task daunting. Here are eight incredible tips for creating a family budget that won’t leave you feeling deprived.

1. Start With What You Have Leftover

How much money do you have left after each pay period? Please don’t fudge numbers out of pride — nearly 20% of those earning six-figure salaries nevertheless live paycheck-to-paycheck. If you eke by with much less, your answer may be “nothing.”

Starting with what you have left helps you to determine the minimal amount necessary to meet your needs. If you don’t have anything left, you know you need to increase your income, decrease your spending or both. This mindset lets your subconscious start working on ideas to accomplish those goals.

2. Consider the Future

Even though you want to cut expenses, you don’t want to sell your future self short for temporary savings. Going without life insurance can leave your spouse and kids in a tight spot if something happens to you. A healthy 30-year-old can find term rates as low as $160 per year — a pittance compared to the thought of leaving your family in the cold.

Likewise, please don’t shortchange yourself when it comes to health and disability insurance. If you wait until you become sick, you might find coverage way out of your price range — if you can get it at all. Fully two-thirds of bankruptcy filers cite medical issues as a primary reason.

3. Sit Down With Your Bank Statements

You need to pay for insurance protection, a roof over your head, utilities and food. You can probably do without hitting Starbucks, at least every day.

Sit down with your bank statements and organize your expenses. Highlight the specific items that fall into the “want” category rather than representing need. Yes, it might be shocking to learn how many miscellaneous charges you accrue monthly, but knowledge is power.

4. Get Relentless With Cutbacks

Here’s your opportunity to embrace the minimalist mindset and eliminate those that don’t bring you joy. Be gentle with yourself — any new habit takes time to become second nature. Eventually, you’ll start to ask yourself, “Will this trinket make me happy a week from now,” when the urge to impulse-shop strikes.

Exercise ruthlessness when it comes to cutbacks. Don’t let false illusions of status prevent you from making fiscal sense. Do you need a Rolex when a Timex likewise tells you when high noon arrives?

Strolling into work with a latte instead of a home-brought mug doesn’t scream, “Look at me, I made it,” so much as, “I can’t be bothered to brew a pot of coffee.” Wasteful consumerism doesn’t make you cool — it’s just proof that you’re nursing some emotional wounds that no amount of money can heal.

5. But Leave Yourself One or Two Weekly Treats

However, if you deprive yourself too much, you’ll start resenting the lack. Even adherents of the three-piggy-bank method of budgeting advise you to devote one porker to splurging on things you love.

Maybe you swear off Starbucks coffee and fast-food drive-thrus Monday through Thursday, but you let yourself indulge on Friday. If you have $75 left out of your paycheck, sink $25 into your emergency fund, $25 into your 401k and use the remaining third to treat yourself to new yoga pants.

6. Find Ways to Pad Your Income

If you hate your nine-to-five, the thought of signing on for more indentured servitude probably makes you feel like a nausea emoji. However, you don’t have to pad your income by taking on a part-time gig that dampens your spirit.

Do you live to knit? Why don’t you set up shop on Etsy and start peddling your wares? Maybe you adore all things fins and fur. People always need reliable pet sitters when they go out of town — some might pay you to take their Fido along on your daily walk. Exercise plus extra cash equals a win-win.

7. Start a No-Touch Savings Account

If you live on a shoestring, you might find saving more a pipe dream. Every time you leave $20 lingering in your account, your child tells you it’s their turn to bring snacks, or their out-of-town soccer match takes your gas tank to E.

Try opening an account at a separate financial institution than your current one and don’t request online access or link it to anything. Preferably, choose one that requires you to drive a bit. If you have to physically get in your car and travel across town for extra cash, you’re unlikely to do so outside of genuine emergencies.

8. Re-evaluate Every Few Months

Creating a family budget isn’t a once-and-done proposition. You should re-evaluate as your financial circumstances change.

Sit down every few months and review your budget. You might be able to delete some expenses — maybe you paid off a car or bought a gift for your BFF’s wedding. If you suffered a cutback in income, look for ways to supplement it.

Use These Tips to Create Your Family Budget

While it may seem overwhelming, you can create a family budget. Use these eight incredible tips to tame your spending and reach your financial goals.