How to Manage a Family Budget : Mistakes & Solutions
Independent Model
Each member of the family has the right to dispose the earned money as he or she wants. Such a model will appeal to those whose income is approximately equal, who appreciate independence or are just about to marry. If you need to cover the total costs, then the couple can "chip in" for these very needs. But since it happens occasionally, and not systematically, the total expenses are often covered by that of the spouses who have money at the moment.
As a result, you have to face grievances. In order to avoid family conflicts, you should negotiate and calculate how much money you spend each month and divide it into halves. The same actions should be taken when planning large purchases. In this case, the one who has money at the moment has to pay. However, it is worth considering that the second partner has a certain "debt", which he or she should pay off when possible, for example, making the next payment for two.
Mutual Respect Model
Each member of the family should make a plan for monthly expenditures and cover them together. However, over time, it may happen that one of the spouses will be promoted and one’s income will increase significantly. In this case, the one should cover more expenses than the partner. For example, if a husband earns 1.5 times more than his wife, then he must spend 1.5 times more on family expenses than she does.
Applying such system, all members of the family feel that they are not only involved in the creation of the family budget but also, to some extent, are financially independent people. By the way, proceeding from the principles of mutual respect, you can save some money for a large purchase or for the birth of a child.
Joint Model
According to most young families, this is the most attractive model. It's quite simple: the spouses' incomes are combined into one big heap, after which a joint decision is being made about their spendings. It is important to keep in mind that such a model implies some spare money on accounts of family members, which can be invested or spent to create a reserve fund. That is, this approach is more productive than managing the family budget, based on the needs, but not the capabilities of the family.
However, the joint family budget has its own shortcomings. Of course, the best is if everyone in the family shares everything, especially money. But over time, the need to reconcile each purchase with your spouse may become annoying.
Common mistakes in the management of the family budget.
Consider the common mistakes made by married couples when managing their family budget:
- If financial problems are left without discussion, the couple may result in a breakup or go bankrupt;
- Solve problems as they arise. Make plans for the distribution of the family budget for at least a month. Otherwise, you may face the shortage of money to pay the bills or a loan;
- Someone should monitor the implementation of the family budget. Otherwise, the plan, which was drawn up very rationally, may remain unfulfilled;
- All financial decisions should be conducted by one person. Even if the salary of one of the spouses is several times bigger than of the other one, he has no right to dispose the money on his own;
- You do not need to save money for personal expenses. If we follow this principle, even the strongest relations will collapse in the near future. It is very embarrassing and even humiliating to ask a husband for money on a new bag or ask a wife to buy a beer;
- Hiding the real incomes from the spouse. The one will get to know the truth sooner or later. And when the secret is revealed, there will be trust left in the family.
