Family
Finances
Some basic ideas to help
your children learn about
money management from
an expert – YOUI!
Setting up a Family Budget
A budget tells us what we
can’t afford, but it doesn’t
keep us from buying it.
William Feather
Objective:
To have more ‘money’ than month!!
Monthly Income
less
Monthly Expenses
Income
 Fixed
 Variable




Do: Bank the extra
Don’t: Depend upon it always being there
SAVE FIRST!!!
Goal: 6-8 months of income
Expenses
 Taxes


first!!
Plan ahead to ensure the correct amount is
being withheld from your paycheck
Overpaying or Underpaying – does either
make sense?
Expenses – ‘typical’
 When
developing your budget, list the
regular monthly expense categories and
their anticipated amounts.






Mortgage/Rent
Utilities/Phone(s)
Insurances – medical/life/auto/home
Food
Gasoline
Car Payment
Expenses - Others
 Tithes/donations
 Gift-giving
 Entertainment
 School
Fees
 Clothing/dry cleaning
 Home maintenance
 Vacations
Expenses – the dreaded
emergency . . .
 Auto
trouble
 Appliance issues
 School fees – sports/band/clubs
 Flooded basement
 What’s your worst unexpected expense?
The Balancing Act
 Total

your regular income (less savings)
Subtract total ‘typical’ expenses
 Money

No? – Re-evaluate
 Subtract

left? (Yeah!)
other expenses.
Money left? (Yeah!)
 Decide
how to utilize the extra . . .
 Saving is ALWAYS a good idea!!
What about the credit cards?
 First


(and only) rule:
Avoid using as a revolving credit
Pay the total balance due EVERY MONTH!!
Currently owe on one (or
more) credit cards?
Balance
Interest
Rate
10%
11%
12%
13%
14%
15%
16%
17%
18%
$1000
$2000
$3000
$4000
$5000
Years to Pay off if only paying a 10% minimum
monthly payment1
3.0
3.6
3.9
4.2
4.3
3.0
3.6
3.9
4.2
4.4
3.0
3.6
4.0
4.3
4.4
3.0
3.7
4.0
4.3
4.5
3.1
3.7
4.0
4.3
4.5
3.1
3.7
4.1
4.3
4.5
3.1
3.8
4.1
4.3
4.6
3.1
3.8
4.2
4.4
4.6
3.2
3.8
4.2
4.4
4.7
$1000 + $150(15% interest) = $1150 / $100 per month – Paid off in 12 months
Kids and Money
Schools assist children in understanding the
numerical value of money.
Parents are responsible for teaching
children the financial value of money.
Talking with them is the first, and most
important step!
WANT vs. NEED
We all NEED to eat.
The WANT comes in when determining what
it is we eat.
The same is true with shoes, clothing
entertainment, etc.
Children at the grocery store
 Encourage
your child to be savvy
shoppers
 Allow them to make decisions about what
foods/brands to buy, letting them
determine how to spend the money they
save
 Do a blind taste test with different
products to determine if price vs. value
Children and Utilities
 Have
a family discussion on the utility
costs of natural gas, electricity and water.
 Seek input on how to reduce the amount
used of each resource
 Reward child with a portion of the savings.
 (Children are more likely to turn off the
lights if they see the positive outcome of
doing so!)
Family Entertainment
 Doesn’t







have to cost a thing!
Community pools
Museums
Library
Parks
Local concerts/festivals
Family game night
Movie night (at home)
Kids and Family Entertainment
 Discuss
budget
 Allow
the monthly family entertainment
your child/children to decide how
to spend this money. Encourage them to
consider saving some (or all of it) for a
bigger type of entertainment: amusement
park/water park/sporting event
Early learning pays off . . .
 When
a child learns how to manage
money at a young age, it will be much
easy to manage larger amounts of
money as they grow older



First car
College
First Home
Your money management
ideas for children!