8 Important Tips to Set a Budget When You have Kids
Mostly, sticking to one budget is daunting for most families around the globe. Undeniably, there are always some unexpected needs that arise and we could not always do what we’ve hoped for setting up the budget. Families with kids are often doing most of the spending on home care, child care, and other essentials, such as food and clothing.
To help families around the globe with the chore of sticking to a budget, we’ve compiled a list of eight important tips that can help you save thousands of bucks and relieve your stress. Here’s what you need to check out:
1. A Spending Review is a Must
Whether you are a new parent or already a parent of kids, you need to renew all your efforts to live within budget boundaries. First of all, consider a little homework assignment. It is all essential to assess and review your historic spending patterns. This is especially important when as many as Covid-19 restrictions are lifted and we are usually in the need of subscriptions and other entertainment expenditures, which we require when cooped up at home.
If you may have expenses, which you can add or subtract, then do it by reviewing, refining, and refreshing your budget regularly. Since it is worthless to create a realistic budget if you have no idea of your expenditure every month.
Do not forget to calculate the average spend across a few months when it comes to variable expenses. Also, include various financial goals such as saving goals or debt repayments. This way, you will get an idea of your whole expenses in a month.
The bottom line is it will also help you to figure out where you may be overspending. Henceforth, you can make a plan to cut back your expenses. In actuality, you could not change what you can’t see, but doing this provides clarity about your spending. What’s more? It also helps you set a realistic budget that you can stick with.
2. Child Care Costs
Undeniably, the cost of daycare can be expensive, especially if you plan to continue working after having a child. To put it simply, you need to plan for child care costs as well. In the District of Columbia, the average cost of child care exceeds 10% of the state median income for a married couple with children, according to a report. No matter how you plan to manage your work, whether it is working from home sometimes or working from the office full-time, you just need to adjust your budget accordingly.
3. Cancel Extra Subscriptions if You Don’t Need Them.
We all have piled up a lot of subscriptions to Disney Hotstar Plus or Netflix during lockdown when we needed more entertainment for our family. However, renewing the same subscriptions, again and again, can be exhausting for your finances. It is understandable that during a covid-19 pandemic, in lockdowns we need an extra dose of entertainment. As our lives return to normal, it’s time to take a long hard look at those costs and cancel subscriptions that you are no longer using.
4. Plan for Future Holidays
You must be prepared for future holidays such as summer vacations, festivals like Christmas, and some special events (e.g. weddings & baby showers). Such holidays can blow your monthly budget. To avoid such a situation, you need to plan a budget and have a savings fund for such expenses. You can simply avoid the unnecessary expenses and tap into credit card swipes.
5. Shop from Affordable Charity Shops
Children undeniably lose small things such as winter gloves, lunch boxes, stationery items, etc. Being parents, we always find the right place to shop for such things at affordable costs. Such small yet useful items, we need to purchase over and over again throughout the year. We suggest that you can shop for such items from charity shops. There are several online charity or thrift shops where you can get budget-friendly offers on clothing and accessories for both moms and kids.
There are also many local Facebook groups, which are popular among moms. They use them like anything since it gives a simple and affordable way to declutter your homes. You can post what you are looking for and monitor the listings for clothes, toys, and household items for your kids.
6. Save on Things, Which Don’t Matter.
Regardless of your budget and income, it only requires two things to match your income and values. For example, you can be more inclined to buy organic food rather than purchase new books, clothes, or toys. Every family’s choice is different. Some families have priority to purchasing new clothes and gadgets; however, some families spend on travel, household, and electricity bills.
When you do not spend as per your child’s wish, it is sometimes a little challenging for both of you at the first time. Your kid might be disappointed with this. But, it will help you to teach and develop such responsibilities. Gradually, they will develop such an attitude toward purchasing stuff, which does not matter.
7. Share your Thoughts With Like-Minded Family & Friends
Talking about your budget openly can help you in several ways. Once you have shared the fact that you are interested in sticking to a budget with your family and friends, the concept will become more concrete. It’s always a great idea to share your thoughts with like-minded people, then they may check in to see how you are progressing in your new rule of finances.
Moreover, it always increases your accountability. Also, it helps you believe in the possibility of achievement. While you do not need to give clarification and full details about this, there is a benefit to sharing with them and asking if they could be your accountability partners in this.
8. Invest in Budget Apps
Budget apps can also help you to set a proper budget in minimal time. Such budgeting apps enable you to connect with all your financial accounts, track spending and categorize expenses. This way, you can see the expenditure of all your spending as well as borrow money online at your fingertips. For example, Mint is a budgeting app, which enables users to plan ahead of their money rather than just track it.
Apart from budgeting features, Mint helps users pay down debt, track goals, track transactions & account balances, and save more money, etc.
Setting a budget when you have kids is challenging, especially when you have borrowed money online and paying down the debt. Before managing all yourself, it’s advised to get counseling from a credit counselor who can help you down a budget. They can cover all your basics and necessities, and keep you on the right track towards financial security.