Page 19 - FAMILY TIMES MAGAZINE JAN 23

FAMILY TIMES -The Family Edutainment Magazine - January 2023 Edition ©

Managing Your Finances in Tough Times - Five Steps You Can Take
In these serious economic times, what can you do to strengthen your
family's financial position? Here are five crucial steps you can take to
put your finances on a more sound footing.

1. Prepare a budget
The number one step you can take is to create a budget for your house-
hold. A budget is a plan for how you are going to spend your money.

Budgeting helps you see how you are actually using your money and
where you need to make adjustments in your spending. Leaving your
finances to chance, as so many families do, is a sure path to getting deep
into debt. Creating a budget involves five basic steps.

First, sit down as a family and set some short-term and long-term goals
in terms of how you want to use your money and time. What's your top
priority? Is it sending your children to college? Saving for retirement?
Spending time with your family? Going on a vacation? Buying a second
automobile? This will get you thinking about how your financial habits
could impact those goals in the future.

Second, calculate your net household income for one month. Include your
regular paycheck, as well as any bonuses or income from investments or
side jobs that you regularly receive.

Third, track your expenditures for a month. Get a notebook and put a
heading at the top of each page for different spending categories such as
housing, food, transportation, entertainment, clothing, medical,
payments on debt and loans, and miscellaneous. Each time you write a
check or buy something with cash, record that amount under the
appropriate heading in your notebook.