According to recent reports, most Americans live paycheck to paycheck. If you have been scraping by for a while then it can feel near impossible to get out of your financial hole. But there are family financial planning steps you can take to give it your best effort.
Read on to learn the steps you can take to get yourself and your family to a healthy financial point.
#1. Set a Family Budget
If you have a lot of money going out the door and you don’t know where you spent it, then there is a problem. You and your partner need to have a discussion about family finances and come up with a solid plan for your spending.
You don’t want to be living paycheck to paycheck forever. Help yourself get ahead and lead a more relaxed lifestyle.
There are many experts out there who will tell you how much to spend on what part of your life, but you need to take all of that with a grain of salt. Only you know where the most important places to spend your money are. But make it part of your plan, don’t try to force yourself into a cookie cutter plan that doesn’t make you happy.
#2. Review Your Debt and Make a Plan to Pay It Down
Many people have debt from child support. If you are paying child support, make sure that you are up to date on your payments and that your children have what they need.
But there are other kinds of debt that people carry as well. If you have student loans, credit card debt, or car payments, then you need to evaluate your expenses and find ways to pay these things down.
#3. Set Aside Money for Unexpected Expenses
You never know what is going to happen in life and while there are always ways to solve problems, most of them are solved more easily with a little bit of money. You need to have some sort of cushion to fall back onto.
Otherwise, you’re constantly living on the balance and are very close to going without the things you need in the face of a tragedy.
#4. Consider Your Retirement and Increase Payments if Desired
In this ever-changing world, many people are working a lot longer. Just look at Ruth Bader Ginsberg, who recently returned back to work as a Supreme Court justice following a lung surgery at 85. In her position, she has survived both colorectal and pancreatic cancer.
Retirement does not have to be an eventuality, if you do what you are passionate about, you will want to do it until you die.
But for those who are punching the clock and counting the days to their gold watch, make sure you evaluate your retirement plan and make sure you have enough to live off of–whatever that will mean in 2060. Truthfully, you should probably live for today and chase your dreams, you just might catch them.
#5. Assess Your Risk Tolerance for Investing
If you aren’t being somewhat risky with your investments, then you are leaving a lot of potential money on the table. And if you go for long term stock options, then you have a high probability of success.
The thing you have to remember about stocks is you haven’t lost anything until you sell. If you invest in companies that you feel confident will be around for the long-haul, then you can ride out fluctuations and sell at a point where you have made a good amount of money.
Just don’t wait for the crest of the wave, they break unexpectedly. Sell when you’re profitable.
#6. Review Your Current Insurance Policies
There is always some room to save money on at least one of the different insurance policies that you own. Make sure you shop around for the best rate and only purchase the coverage you need.
But also, don’t underinsure yourself or save yourself money by setting an unreasonably high deductible. Whatever your deductible will be should be an amount you already have in savings for in case something happens.
And you should have enough insurance to ensure you are protected in the case you get hit by an uninsured motorist or have extensive health issues following an accident.
#7. Consider Alternative Health Insurance Options
If you are paying a hefty portion of your salary towards a company health insurance plan, then you need to reevaluate if that’s really necessary.
Many companies offer multiple levels of insurance and different kinds of insurance that make sense for different families. Make sure you find out what all of your options are and choose the policy that makes sense for your family, not just the default policy.
#8. Buy in Bulk Biweekly
If you follow the sales in your neighborhood, you should be able to plan out biweekly trips to your favorite bulk food stores like Costco and Sam’s Club.
You should also look to see if there are any restaurant depots in your neighborhood where you can go to buy restaurant-quality food in bulk. That way you’re buying from a community run business and potentially getting great quality local produce.
#9. Become the Coupon Lady/Lad
It’s time to take up the mantle! Coupons are out there for you to save money. Make sure you take the time to look to see if there are any savings available on the items you buy.
But make sure you don’t allow coupons to serve their other, more dubious purpose, making you buy something you didn’t intend to. Remember, you can’t save money on something you weren’t going to buy in the first place–also a good tip for Target!
More Family Financial Planning Tips
Family financial planning is incredibly important if you want to have a healthy home environment where you can grow as a family.