Simply put, budgeting is creating a plan to help keep your finances in control. As a family, it’s important to involve all members in your household in the budgeting process to help them understand how much money it takes in order to maintain your household and daily life. Introducing the concept to all members in your family not only helps them understand your household finances, it also teaches them how to be resourceful, responsible and transparent. Here are a few tips to make sure everyone is on the same page when it comes to your family budget.

Be Transparent: Money does not grow on trees and it is important to discuss how spending affects everyone in the household. It is important to make sure to involve everyone when discussing your family budget to help build a better understanding of your family’s financial picture. Create a plan of action on how you want to take on your family’s budget whether it be a month-to-month perspective or a full year overview. This budget will apply to all aspects of the household: rent or mortgage, utilities, groceries, auto, cellphones, clothing, extracurricular activities, emergency or vacation funds, etc. Have a family meeting and explain to all members of the household what your current budget is and how each member can help contribute to keep things on track. Help them understand the difference between nice to have items versus essential living expenses and how important is it to track all the spending. Also take into account any requests or concerns family members may have in regards to spending. Explain the type of bills that are paid and when they are due, how conserving water or electricity effects the amount that will be billed and how to eliminate waste. This will give a clear understanding of how a household runs and the importance of your budget to keep everyone on track to achieve your family’s financial goals.

Give Responsibility: Once you have had the initial discussion with your family, assign age appropriate roles and tasks to make sure everyone is included in keeping the budget on track. You can come up with ideas and assign tasks like; keeping track of grocery inventory to make sure food is being used and not wasted, finding coupons when it’s time to go grocery shopping or creating meal plans to help save money and eat at home. Someone else can do inventory of toiletries, come up with budget friendly activities to do with the whole family or make sure appliances and electricity throughout the house are turned off and unplugged when not in use. You can assign an older member of the family to set reminders or charts to show who is assigned to what specific tasks. Inclusivity and responsibility creates accountability and teaches the importance of the overall budget dynamic along with instilling these important life lessons that will help all family members.

Be Resourceful: There are many different ways to become resourceful around the household by introducing small concepts that can create money saving habits. For starters, try water conservation by turning off the water when brushing teeth, washing dishes only when the dishwasher is full, cutting down shower times, setting timers for sprinklers or washing clothes during off-peak electricity times. Other popular ideas include recycling and creating a garden to grow your own fruits and veggies. Recycling can not only teach your kids the importance of helping care for the planet, but also responsibility and money management by allowing them to keep or contribute the money earned back to the family budget. Growing a garden together can help introduce the importance of eating fresh vegetables and fruits, help cut back on grocery costs and can create a fun activity to do as a family. This can also form the basis of the discussion on how waste can be reduced in your household, the importance of reusable items and how to make the most of the items you currently have to become more resourceful.

Make it Fun: Take the above steps and make them your own. Each family is unique with various financial circumstances, so it is important to create a plan that works best for you and your loved ones. The main goal is to make sure a budget is established and everyone is participating to ensure you all keep on track to reach your financial goals together. Keep everyone involved by creating a game, or offering incentives for reaching certain goals and keeping on track. You can use a point system or chart to keep track of tasks assigned and distribute rewards that everyone enjoys when you meet certain budget goals. If you have younger children participating, you can create a reward box or prize list if they continue to make positive changes in the daily routine to help toward keeping your budget on track. Make sure to acknowledge your family members when you see them doing some of the new changes and discuss over family dinners. Regardless of how you decide to make this fun for all, the end goal will be positive and lead you and your family toward creating new habits and goals to maintain your family budget.

Now that you understand the basics and the importance of family budgeting, it’s time to create your plan. Remember to be transparent with your loved ones and make sure they understand how your household operates, what is included in your budget and how each person can do their part.

Visit our Financial Knowledge Blog to learn more tips on setting up a solid financial future or join us for Financial Wellness Wednesdays.