A family budget is a great way to manage your finances, providing you’ve got everything covered. When you create a comprehensive household budget, it’s important to include all your expenditure but it can be tricky to remember everything you spend throughout the month. If you want to ensure your budget can be a valuable tool for your family, make sure you remember to include these easy-to-forget expenses:
5 Things You Should Always Include in the Family Budget
- Car Repairs
If you own a vehicle, you’ll probably already have the cost of your car insurance, road tax and breakdown cover included in your budget. However, if your vehicle is more than three years old, it will also need an annual MOT. This typically costs around £65 but it can uncover issues with your vehicle which may need fixing. Additionally, a breakdown or malfunction at any time of year could increase your expenditure.
Although you can’t know in advance how much car repairs are likely to be, you can incorporate them into your monthly by setting some money aside for them throughout the year. This ensures you’ll have the funds available when you need them and means that a big repair bill won’t catch you off guard.
- Gifts and Presents
If you celebrate birthdays, Christmas, Eid, Purim, Diwali or any other festival, then you may choose to give gifts to friends and family at these times. If so, you’ll certainly want to include this in your family budget. Depending on your disposable income, you may simply add them to your costs during a specific month of the year or you may choose to spread the cost. If so, you can enter a pro-rata figure every month and set the money aside so that you’ll have enough money to buy your presents when the time comes around.
- Life and Health Insurance
When you’re updating your family budget, be sure to include any insurance policies you currently have, as well as any you’re planning to take out in the near future. This includes car or property insurance, but it should also include life and health insurance. With a term life insurance calculator, it’s easy to see how much you’d need to budget for a specific level of cover. If you want to take out £100,000 life insurance, for example, a life insurance calculator can tell you in seconds how much your policy will cost each month. This makes it easy to budget for this important expenditure and gives you peace of mind that your family’s financial future is protected.
- Kid’s Activities
If you have children, you’ll know just how expensive they can be! As well as buying essentials throughout the year, there’s a good chance you’ll also finance a variety of activities. This might include big days out to the seaside or an amusement park, but it can also refer to music lessons, sports teams or even regular trips to the cinema.
Remember – if your child is part of a team or group, there may be regular travel involved. Sports teams routine travel to play away games, for example, or to take part in tournaments. As well as including the cost of each activity session in your budget, be sure to factor in the cost of travel, equipment and clothing too.
When you include savings in your family budget, it enables you to prioritise the future. By calculating your income, essential costs and disposable income, you can evaluate how much you can afford to save every month. Once you have this figure, be sure to input it into your budget so that it becomes a regular thing. You can even choose for a set amount to be automatically transferred from your current account to your savings account when you get paid.
No matter how much you choose to save, be sure to set yourself financial goals. Whether you’re planning to take a family holiday or move into a larger home, having concrete plans and targets will give you the motivation to stick to your budget and keep saving.
Managing Your Family Budget
People often assume that budgeting means living on as little as possible or going without any luxury purchases, but this isn’t the case at all. A family budget is simply an effective way of managing your household’s finances, avoiding unmanageable debt and planning for the future. By taking the time to ensure you’ve got all your costs covered, your family budget can protect your family’s financial future and give you complete peace of mind.