This article addresses five areas of spending that in my experience can determine the health of your household finances. On one hand, they can be a detriment if addressed incorrectly. And on the other, if handled correctly, they can be a source of extra funds for your family.
1. Shopping Blunders
The first mistake many moms make is shopping when we are hungry or bored. For a mom with small children, a shopping trip may be one of the few outings we get in a week. And it is at these times we browse the store more, and buy more. The other scenario is that we shop hungry. You go in the store with a concise practical list and come out with a buggy full of snacks. Eating a snack before you leave the house can help curb this tendency. Another mistake is impulse buying. Really think about the things you buy, and whether or not you need the item. Will it end up in next spring's garage sale? If so, you might want to reconsider the purchase. Avoiding these blunders can add up to big dollars for your family each month or each year.
2. Paying Bills Late
A lot of people may consider paying their bills late no big deal. Or, if you are like me you are terribly disorganized and have a tendency of forgetting until the next day. However, most companies charge late fees for each time you pay a bill late. Do yourself a favor and buy a bill organizer. Also, paying bills late can equal lower credit scores. This is a double whammy, because you will pay a higher interest rate on top of those fees. Over the course of a year, paying your bills on time can add up big time for your family.
3. Eating Out
Because we live such hectic lives, eating out can be a welcome respite for a weary mom. But avoid the temptation to eat out too often. Try to limit "eat out" nights to one or two nights a week (or less if you can). For a family of four, a trip to a mid-priced restaurant can cost upwards of $40 to $50 dollars once you count in the tip. Try cooking at home most nights to save big money. If you are pressed for time, make use of a slow cooker or a programmable oven.
4. Debt
Most of us have debt...there's nothing surprising about that. There are typically two types of debt: secured and unsecured. Basically secured debt is something that can be sold for near value of the debt (like a house or a car). Unsecured debt is debt that is not tied to any property ( like credit cards or student loans). Both can be used for good or bad. An example of good secured debt is a first time home buyer buying a home well in their budget, but a bad example is a person buying more house than they can afford. A good example of unsecured debt is a credit card used for needs and paid off each month to raise a credit score (but most of us are very weak in this area), or a student loan used for an education that will well pay it off or be worth it to the student. Contrary to popular belief, a student loan is not always a good use of unsecured debt. Credit cards are the biggest problem for most families. They are great to have for emergencies, but can be a budget killer when used for non needs items. The balance seems to slowly climb and before you know it you are in deep debt. So to avoid this, think before you swipe. Ask yourself, "Is this item a need at this very moment in time?" and "Is there any other way to pay for this?". By avoiding this pitfall, you do your family and your budget a world of good. Also pay down high interest debt first. Pay minimum on the lower ones, and pool your resources to pay off the high one first. Then after it is paid off you move on to the next one and so on. This is the best proven way to pay down unsecured debt.
5. Unexpected Events
You may have false security that if something unforeseen happens and someone in your family ends up hospitalized, you will be fine because you have insurance. Well, think again. Usually there is a deductible ($500.00 for instance), and you must also consider that 20% and those sneaky things that aren't covered. Also consider meals and needs for the family while the family member is hospitalized and their medications once they are discharged. A lot of people have been told that if you owe a hospital money, they have to by law accept any payment from you no matter how small without collecting. This couldn't be more wrong. A hospital will send you a bill and you have two options. One is that you pay your balance in full right then and there. The other is that you call the billing department to set up payments, and the amount is determined by them and will not be small. Other unexpected events can be replacing appliances, vehicle repairs, and other household repairs. Make sure you have a source for emergency funds. Now, I realize that most of us just don't have it in our budget to save for emergencies all the time. You can take the money you saved from the other tips to save up, or just have a low interest credit card you can use if something happens (keep locked away unless it is an emergency). Your diligence in providing a way to pay for emergencies will more than pay off in the considerable amount of stress you will save you and your family.
Sarah is a stay-at-home mom and devoted wife whose interests include music, writing, theology, learning, and spending time with family. She is a true southern belle hailing from the great state of Mississippi.
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