This is a collaborative post.
Raising a child might be one of the most rewarding experiences in life, but it’s also one of the most expensive! From the baby paraphernalia you need when your child’s first-born to driving lessons and university fees when they grow up, you’ll need to budget every step of the way.
Although managing your finances can be tough when you’re raising a family, there are ways to cut your costs. If you want to take control of your finances this year, take a look at these simple but effective ways to save money as a parent in 2021
1#Identify Spending Habits
Before you make any changes, spend some time assessing your current household spending. If you aren’t sure exactly what your income is – or where your money goes each month – examine your bank statements to ensure you’ve got an accurate idea of what your financial situation is. Once you’ve got all the information you need, you’ll be able to make a plan for the future.
2#Create a Household Budget
A household budget is essential if you want to stay in control of your family’s finances. Download a template, install an app or grab a pencil and make your own, but be sure to include everything. From utility bills to takeaway coffees, make sure you incorporate everything into your budget.
Creating a budget can seem overwhelming, particularly if you’re worried about your finances. However, it’s a great way to see exactly what your income and expenditure is and gives you an important starting point to work with.
3#Check Kids’ Spending
As your kids get older, they may have their own money to spend. As a parent, you’ll want to ensure they use this wisely, as well as letting them splurge on some luxuries. Teaching your kids how to save is an important life lesson, so check in on their spending and encourage them to make sensible choices.
Don’t forget – many children have access to their own accounts via online banking, so don’t assume that your kids aren’t spending money simply because they haven’t left the house. Monitoring their internet usage is an important way of maintaining their safety, so don’t miss the demo if you want to find easy-to-use tools to monitor your kid’s online behaviour.
If you have your own card details stored on devices or saved on websites, be sure to add passwords so that youngsters can inadvertently rack up hefty bills too!
4#Make Saving a Priority
Many families aim to save whatever they have leftover at the end of every month, but this isn’t always a great financial strategy. The temptation to spend your disposable income, rather than save it, means you’ll end up saving less than you intended to. By working out your budget in advance and incorporating savings contributions into it, you can ensure that setting money aside is always a top priority. Setting up a standing order so that a set amount goes into your savings account on payday can be a good way to ensure you contribute to your savings regularly, for example.
5#Set Savings Goals
If you’re saving money because ‘you know you should’, it can be hard to stay motivated and tempting to dip into your savings fund. However, if you’ve got a clear goal in mind, it’s easier to stay on track. Whether you’re saving for your child’s birthday presents, a dream family holidays or for future education costs, allocating a purpose to your savings makes it easier for you to hit your targets.
6#Create an Emergency Fund
We’re all hit by unexpected financial emergencies at some time or another, but you can avoid dipping into your savings by having a separate emergency fund to fall back on. This will ensure you’ve got access to cash if and when you need it, without your savings taking a hit. From urgent vehicle repairs to essential house maintenance, having an emergency fund will give you peace of mind too.
7#Managing Money as a Family
Although you won’t want your kids to worry about your family’s finances, you don’t need to shield them from every financial conversation. In fact, teaching kids how to budget is a valuable lesson. When you’re creating your household budget, be sure to include your children and even ask for their input. By ensuring everyone has a say in how your entertainment budget is spent, for example, you can ensure that every member of your family gets to do something they enjoy in a budget-friendly way.