There is a great amount of responsibility when it comes to making sure your child is loved, cared for, healthy, fed, clothed, educated and much more. Not all of this is dependent on family finances, but part of what is required to take care of a family and children requires financial responsibility.
This blog post is not about how to make money, but instead how to be responsible with family finances. A quote comes to mind that I read recently,”You can never get enough of what you don’t need because what you don’t need can never satisfy you.” This quote summarizes much of what there is to say about financial responsibility.
The first thing I want to suggest for being responsible with family finances is to donate 10% of your income to charity. That sounds crazy, but charitable giving is a principle of wealth accumulation and management. It’s easy to think that charitable giving is only done by the wealthy, not so. On PhilanthropyRoundtable’s website it says:
“the vast predominance of offerings comes from average citizens of moderate income. Between 70 and 90 percent of all U.S. households donate to charity in a given year, and the typical household’s annual gifts add up to between two and three thousand dollars.”
How does this help us with managing family finances? One way it helps is that it keeps in check the inner desire to having things we don’t need. Like a big house or that really nice car. If your income is modest at best, then committing to donate 10% of your income to charity also means you must commit to live within a budget.
Family budgets are the second thing I want to suggest. I know… this doesn’t sound like fun! Budgets feel restrictive. In reality they provide freedom to be in control of your money and spending behaviors. There’s an old saying that says, “there’s too much month at the end of my money.” A budget helps in making it possible to have enough money at the end of the month instead of the other way around. A budget won’t always make you immune to “the-too-much-month-at-the-end-of-my-money” syndrome, but it can help a lot!
Save, Save, Save…
Once you have established a budget, you will have a better idea of how much money you can put away into savings. Savings is my third suggestion for family finances. Even if you can only save a little, make sure you do it. You never know when you will need (disability, lay-offs, death) that money. Having that money saved away will give you peace of mind for when you really need it.
Stay Out Of Debt
The fourth suggestion to being financially responsible is to stay out of debt. This can’t be emphasize enough! The interest you pay on your debt never sleeps and never goes on vacation, it is always there until you pay it off. Too much debt can become crippling to a family and with that there is a loss of freedom. There are some things that require debt, like education, a house, and maybe a car. When it comes to those things it is very important to be prudent and carefully asses how that debt will impact family finance and your future.
In conclusion I end where I started. Responsibly managing family finances is choosing to set yourself up to better care for your children. This means to make sure they’re health, to clothe them, and to provide an education for them, and to provide opportunities for them to grow. To do this, donate 10% of your income to charity, follow a family budget, make sure you are saving some of your income, and avoid and/or minimize debt as much as possible. If you so these things you will be better off than if you did not do them.