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Budgeting and Family

Hello there! Did you read up on our previous post? Do check it out as we introduced what Budgeting is all about, its benefits and how you can go about it.

Today we bring you a harsh reality on how families deal with finances and how inadequate or even a lack of planning has brought about ruin to so many homes and not just this, but a recent study showed an upward number of issues arising in relationships when partners/spouses mismanage and misappropriate monies.

We all know that love is beyond mere feelings, love is really an action word and one of the best ways to profess love is to do the very things that secures the future of a unit, to put a plan in place that will address the standard of living of a family. Too many times, very rarely do you find families take the time to sit down and actually have a common financial goal that could lead to putting together a plan that meets these goal(s). It is sometimes left to the breadwinner who tries to meet all obligations with no idea as to what are really the actual ‘needs’ and wants of every member of the family.

This has been as a result of lack of communication amongst spouses. 80% of spouses in Nigeria find it so difficult to sit down together to discuss their budget and expense. In reality, you either see the man, who most times is the breadwinner give the wife housekeeping allowance, which most times a lot of people itemize as ‘feeding money’. He gives it to her and says, ‘go and manage it’. Others simply pay for certain capital expenses like house rent, DSTV subscription, School Fees, car maintenance and then wifey takes care of feeding without sitting down to calculate the cost elements and how they can either cut down and save some expenses. These issues have been a cause of major scuffles in homes.

A family budget is a plan made by all stakeholders in that unit, that details how the family income will be spent on the various items as agreed upon expenditure over a specified period of time. Expenditure may be classified as needs which are necessaries, wants as comforts, luxuries, obligations, contributions or any other classification deemed necessary. However the key thing to remember is for a budget to work, inputs will be needed from stakeholders so that decisions are adequately understood by all.

Finance is a major deal breaker in most modern marriages and it accounts for how stable and happy a home is most of the time. However, it is not all gloom and doom, with healthy financial choices to decrease expenditure, eliminate debts and save money, it is fair to say a family stands a better chance to live a happy and balanced life if they have the regular habit of having such financial conversations regularly.

The first step to achieving this is to decide to live on a budget. A Budget here will help track a family’s income and expenses. So how does it work?

  • Identify all your streams of income and calculate all income from both spouses.
  • Identify all expense elements either daily, weekly or monthly, gather all of the bills and payables, bank charges, subscriptions, school fees, everything owned that shows money coming in and going out.
  • Sit down and write a budget – identify expenses that can be done without, leaks can be plugged, cheaper alternatives or options without compromising on quality, new opportunities can and should be explored.
  • Set Financial goals – could be savings towards a child’s education, vacation, real estate or perhaps a quick reduction on utility bills, cable and other recurring expenses that are keeping you from saving more money each month.
  • Money that you have been able to save from your budget, you can save it towards achieving your set financial goals
  • Work intentionally towards being debt free
  • Plan for financial emergencies.

Until we come your way again, we hope that you will take these lessons to heart and take absolute control of your personal finance.

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