Money is a cagey topic of discussion among some families. No matter the different levels of incomes, this subject has caused conflict and hatred in some families due to poor financial management.
But some people live harmoniously with or without money. You may ask: How is it so? Is one party carrying the burden or have they come to a conclusion to work it out?
The Covid-19 pandemic has revealed so many challenges families go through and managing finances you would say took centre-stage.
Situations come and go; families have to be managed with a sober mind, budgeting as a family is very important.
Each family should set out from the onset on how to manage finances. A clear savings and spending plan goes a long way in limiting conflicts over finances in a family.
A family budget shows how your money (income) is distributed between different expenses, such as rent, car payments, and credit card payments.
Money is usually divided into different categories, including income and expenses.
Here are some tips on how you can manage finances as a family.
Successful families world over have been able to leave harmoniously because they sit on the table and identify their needs and wants and how to spend the money in their basket.
To limit conflict, experts advise that you plan as a family.
Good financial management requires you to be open minded and discuss your finances as a family while weighing your options so that everyone is aware of the changes you have to make if any.
Indeed, Ms Lyndah Nabayinda- a personal finance expert and co-founder of Ascenity, in an interview with Prosper Magazine, says: “Not only during Covid-19 times, it is paramount for families to plan their finances together at all times.”
According to Nabayinda, you should discuss ways how to ensure the home progresses.
“Any family should bring to table all the loans each party has; vehicle loans, memberships, credit card debt, grocery shop debt, and prioritise which ones to settle, reschedule, or pay first,” she shares.
In addition, discuss joint savings and investments - plus which option to maintain or get rid of. Pick one with better terms.
“This protects each ones dreams and may bring you both emotionally closer and bridge the trust issues most couples face,” Ms Nabayinda adds.
This will bring about more harmony and financial growth in the home.
Cementing on Nabayinda’s submission, Mr Nathan Were- Access to Finance Specialist at the Boulder Institute of Micro-Finance , thinks it is critical for families to prioritise.
Were advises families to budget and buy household consumables in bulk to save costs.
According to Were, priority on basics with luxuries should be postponed as some people have lost jobs while others’ salaries have been slashed.
“We also see a lot of caution especially for domestic workers on efficient use of what is stocked and funds become tight,” he adds.
But budgeting as a family helps people size up and start living within their income.
“Over the years, people have been either abusing systems but with Covid-19, and companies struggling, government spending less there are limited allowances to earn,” he cautions.
As we wait for the Covid-19 vaccine, expert say the new normal is for people to continue to live within your income and to do so requires budgeting as a family with the little resources you have left.
Involve children and teens in making a family budget- Making a budget together helps children understand that you all need to make hard decisions in difficult times.
Be mindful of what you spend on during this period. Is it a need or want?
Needs: Which things are important or must have for your family to survive? (such as food, soap to wash hands, needs for ill or disabled family members) wants: Which things are nice to have but not essential?