Ways to Stay on Budget with Growing Children
The expenses associated with raising children hit parents well before their children are even born. Maternity healthcare expenses, preparing the nursery and even lining up childcare for the baby’s first year can all take a toll on a budget, and the expenses only continue on from there. While the first year of a child’s life can be expensive, parents of older kids may easily agree that the expenses only increase with age. Furthermore, the expenses are magnified when you have more children. Staying on a budget with kids can seem next to impossible for some, but there are some tips that you can follow that can help you to better manage your budget.
Develop a Realistic Budget
Developing a realistic budget may seem like something that goes without saying, and this is because you simply cannot follow a budget if you do not have one prepared. However, this important first step is an area that many parents lag behind on. A budget should cover all aspects of your expenses, including clothing, co-pays for doctor visits, trips to the movie theater and more. More than that, it should be referred to regularly. You should use this tool to help you make financial decisions for your family. For example, if your child could use a few extra shirts but you have already spent all of your clothing budget this month, you may need to wait until you have money in your clothing expense section next month to make your purchase. Otherwise, you will need to pull money from other areas of your budget to cover the purchase, such as from your entertainment budget.
Plan For All Expenses
In addition, you should plan for all expenses rather than recurring expenses. Family expenses can vary from month to month. For example, in August, you may have hundreds of dollars in back to school expenses. For Halloween, you may need extra money for costumes and candy. In the spring, you may need to plan to spend more for clothing to update the kids’ wardrobes seasonally. Many parents who budget well find that preparing a six or nine-month budget that takes into account all recurring, seasonal and one-time expenses works best, and this is because many of the expenses associated with raising kids fluctuate and vary.
Have a Rainy Day Fund
You can reduce a lot of your financial stress when you budget properly, and this is particularly true if you budget several months ahead. However, even with proper planning, you may not be able to account for everything. For example, a trip to the emergency room, the need to pay the house insurance deductible when the roof is damaged in a storm and more cannot be accurately planned for. However, these types of things can and do occur, and you need to have a financial plan in place to pay for these expenses. A rainy day fund can provide the extra funds you need when an expense arises that is not included in your budget.
Budgeting with a growing family can be stressful, but it is not impossible. With proper planning and effort, you can develop a realistic budget and can plan for the majority of the expenses that will arise.