Ideally, you’d save a big chunk of your income every month, put it away in an investment account for many years, and then wait for the returns to accrue. But, unfortunately, that’s not how things work in reality. Instead, family and responsibilities get in the way. And you soon find yourself living paycheck to paycheck, with nothing left over at the end of the month to put aside.
If you’re a family in this position, you’re not alone. In fact, it’s something that affects nearly one in three families with young children. Fortunately, there are still ways you can save and prepare for your future, even if you’re a busy parent and responsible for a house and car.
Stop Buying Everything On Credit
If you’re like a lot of people, interest payments are eating up a big chunk of your disposable income every month. Not only do you have to pay back the principal, but also the ever-growing mountain of interest too. And that can eat into your personal wealth.
Here’s a simple rule: don’t buy anything on credit. Instead, have the discipline to wait until you have the money to afford the things you want. This way, you’ll reduce interest charges and increase disposable income.
Give Yourself A Reason To Save
Saving money for your family is all well and good. But to make a real success of it, you need a genuine reason to save - something that will motivate you long-term. It could be something as simple as a prize linked savings app or as grand as getting money together for your child’s education.
Giving yourself a reason to save helps you to continually answer the question of why you’re depriving yourself. Putting money aside each month is never easy. But once you have a compelling reason, it becomes more psychologically manageable.
Don’t Make Excuses
As people, we tend to compare ourselves to our friends and family. If they have mountains of debt, we tell ourselves it’s okay for us to do the same.
But, unfortunately, that’s just making excuses. And it means that we are simply a reflection of our community, instead of independent rational beings in our own right.
Stop Thinking You Deserve The High Life
Here’s another problem families often run into: believing that they deserve the high life. You’ve worked hard, you tell yourself, so you deserve something special and expensive, like a new car or vacation.
But, unfortunately, the market determines what you deserve, not your feelings. So if you start thinking that you deserve something, ask yourself whether you actually do, based on your productivity. Usually, you’ll find that you haven’t made enough money to justify the purchase - at least, not yet.
Make A Budget
Families should always have a budget. That’s because raising one is like running a small business. You have to divide up work and ensure that you minimize your expenses where possible.
If you don’t have a budget yet, make one. They’re easy to put together. And once you have it, you can start making more conscious decisions about where your cash goes.
CANDY TAI is a wife to David and mom of 5 with a degree in Communications. She's a native Texan (Hook 'Em Horns!) who's been making her home in the Kansas City metro area for nearly 15 years. She loves being able to shuffle her kids from their various sports activities, piano lessons, and school activities. She enjoys fashion, beauty, reality TV, and moviegoing.