5 Steps to Sound Family Finances

If family finance wasn't already bad enough, Covid hit, and now we have discovered that many people find themselves in a state of financial despair.  Lost jobs, rising prices, strange income situations - they have all taken their toll. Our family is not wealthy by any means.  We live on the salary of one engineer.  But I have found that the following principles have contributed to peace about our family finances:

1. Give first.  We have followed this principle throughout our married life.  We give before we do anything
   else with our paycheck.  We have chosen to donate to our church and also give money to humanitarian aid and other worthwhile 
2. Save for the future.  Saving 10% is a good rule of thumb. Again, the savings comes out before we do other things.  We have been saving like this for years.  Now, as our children are going off to college we aren't stressed.  We saved money for these expenses a long time ago.
3. Budget.  For years I did not budget well (the only thing that saved me was principle #4).  Thanks to a class that we took from our church we are now doing so much better.  There are many apps out there for budgeting.  We liked Goodbudget because we got paid bi-weekly.  Mint is another one.  But things weren't completely adding up.  So, we borrowed a friend's spreadsheet plan and used it to make our own budget.  The key to this is we have one account for occasional expenses that come during the year (holidays, vacations, education, sports and similar expenses) and one account for our bi-weekly budgeted items.  And the budget only works if you do it regularly and stick to it.
4. Don't do Debt.  Just don't do debt.  And don't buy things you can't afford.  The only debts that make sense these days are debt for a modest home and education.  Cut up those credit cards and live simply!  
5. Have a Supply of Essentials on Hand.  During Covid we learned the hard way that all the money in the world won't be too helpful if the stores are out of toilet paper and macaroni and cheese.  We stood in lines and panic bought with the best of them and I vowed this would not happen again.  I have a stocked storage room now and if I take something out I make a note to replace it immediately.

May these tips lead you to a happy and prosperous future!  And here is one of our favorite videos full of budgeting wisdom:

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