Monthly Archives: February 2016

Improve Your Family Finances

It all starts with a simple step – make a budget! The most important thing about improving your family finances is to get a clear picture of exactly where you stand. Once you know that, you have a clear understanding of the positive and negative aspects of your financial position you can identify clear steps to take in order to move forward, and improve your finances.

A budget is the backbone of any financial endeavour – whether you are running a business or a household. You must be clear about what financial responsibilities you have, as well as be clear about what your income sources are. The key here is to be completely open and honest with yourself – if you’re not, the whole exercise is futile.

It’s also important to identify financial goals for yourself and a clear timeline in which you want to achieve them. Examples may include going on a holiday, buying a car, paying off existing debt, or buying a house. No matter what the goal, make sure you have a set date you want to achieve it.

To speed up the achievement of your goals, take steps to increase savings, income streams (if possible) and reduce your level of debt. Your personal debt is money you give to someone else each time you have income, so obviously if you reduce those debts, you’ll improve the amount of investable (not disposable) income.

Pay off your credit cards, then cut them up to make sure you don’t run them up again. Pay extra – as much as possible – on your debts to repay them earlier. This will usually save you money because the longer you have these debts like a car or personal loan, the longer you are charged interest. The more you pay on the debt, the less interest is charged and you can pay it off quicker because you are reducing the principal amount of the loan.

If you’re like most people you will have multiple interest incurring debts. You can attack your debt using a number of strategies. Personally, I like to repay smaller amounts first, because the psychological impact of removing a debt from your list of liabilities is fantastic. Plus, the amount you used to pay on the smaller debt can then be snowballed onto other debts – reducing them quicker. Other people may like to repay any extra they have on the debt which is incurring the highest amount of interest. The bottom line is that you should do whatever suits you and your goals.

How to Successfully Manage Family Finances

Married couples should not argue so much about their finances. If they only know how to discuss issues pertaining to money management in the most subtle and less emotional way, then solutions will be easier to find and husbands and wives will be happier.

There are simple ways you can do to ensure that your finances are in order. If you’re able to do this, then there’s a better chance that you can avoid going into debt moving forward. This is a benefit not only married couples can enjoy but even their children.

An important step is to keep track of all your expenses. This should include all those you’re paying for on a regular basis regardless whether it’s a month to month basis, quarterly or annually. Make sure to keep a record of your water, electricity, telephone, loans and credit card bills and put them in a folder or envelope whichever is convenient for you.

The next step is to classify and segregate them. Gather all those you’re paying monthly and separate them from the quarterly and the yearly ones. Just ensure that you keep your envelope in a safe place not reached by your small children or in a place where it cannot be mistaken as some other document. Never put it on the desk where your computer is and avoid labeling it as just vital financial information.

Listing them down is another highly recommended step. A notebook of any type will come in handy. Divide the pages into three parts again for your monthly, quarterly and yearly bills or expenses. While at this stage, it may be helpful to specify the mode of payment for each. You need to note whether it’s on auto-pay from your checking or savings bank account, charged to a credit card, paid by check and so on.

Whoever is budgeting the family finances should as much as possible update the other spouse of where their funds are going and how much savings have been gained. As most wives take charge of this task, it’s best to find a time to sit down and discuss financial matters with your husband. This is the perfect time to clarify things that may have caused one of you to doubt the other. This can even be another form of bonding for both of you.

Finally, you have to make a commitment to pay for your bills on time consistently. If you’re using a bill paying service, for instance, make it a point to provide each other with the login details. This step you can also take if you’re using an auto-payment system such as in your checking account. It would help if both of you cooperate on this matter so your family finances are really well taken care of.

Handling money comes with a great responsibility. But if you’re able to live up to your obligations and continue to work hard for your family, then you will have an opportunity to give your spouse and your children a better life ahead which can make you happy for the rest of your life.

3 Tips to Run the Family Finance

In any contemporary society, three classes of couples could be identified, namely: the salary earning, the self-employed and the one employed/other self-employed couples respectively.

The Salary Earning Couple -The salary earning couple simply means that both the husband and his wife are gainfully employed either as public servants or factory workers. In this case, their income is fixed, prompt and regular, too.

The Self-Employed Couple -The self-employed couples are into private business either jointly or severally. In this case their income may not be fixed, prompt and regular.

The One Employed/Self-Employed Couple -One of these couple is gainfully employed with a fixed, prompt and regular income. The other is into a private business wit a non-fixed, non-prompt and irregular income.

The Ideal Status
Irrespective of above classes of couple, it is ideal that the husband’s income be higher than that of his wife as the bread-winner of the home, according to the biblical stand point. A husband would stand his grounds where he does not shy away from his financial obligations and responsibilities to his wife. He must not be among the class of husbands who cleverly shift their financial responsibilities on their wives.

However, most women, by virtue of their educational status and parental influence earn more than their husbands either as business merchants or public servants. It is not biblically ideal for a husband to be under the control, influence or manipulations of his wife’s finances. Nevertheless, he should not be too spiritual or envious that he rejects here financial assistance. Most women are tenderhearted, merciful, generous, loving and caring. They could give everything they have to their husbands, shouldering his financial responsibilities but on the condition of trust.

The financial management responsibilities in a Christian home are the exclusive preserve of the husband but not without his wife. They should make their budget and agree on their expenditure not as individuals but a couple.

Budgeting is not only vital but also essential to effective Financial Management in a Christian Home. This budget includes items such a Tithes, Feeding Allowance, Rents, Electricity and Telephone Bills, Transport, Fuel and Maintenance of the car, waste Disposal, Children’s Allowance, Savings and others. Budgeting allows for the allocation of sufficient funds to each of the items. The husband could keep labeled envelopes for each item. The wife must conduct a market research prior to the family budget to compare the prices of items to buy, having the overview of the market situation as it affects or may affect their budget.

Restricted Expenditure
A Christian couple must live within their income. They should not borrow except for capital expenditure. God’s commandment in this respect as contained in Deuteronomy 15.6 is that: “you will lend unto many nations but you will not borrow.” Ellen G White in her counsel on Stewardship wrote, as follows: “Many, very many, have not so educated themselves that they can keep their expenditure within the limit of their income. They do not learn to adapt themselves to circumstances, they borrow and borrow again and again and become overwhelmed in debt, and consequently they become discouraged and disheartened. We should be on guard, and not allow ourselves to spend money upon that which is not necessary, and simply for display. We should not permit ourselves to indulge in tastes that lead us to pattern after the customs of the world, and rob the treasury of the Lord.”

Several marriages ended up in divorce because of greed and lack of budgeting. For example, a civil servant on grade level 03 would buy an elegant food flask in the month of January, latest shoe design in February, expensive attire in March and so on, throughout the year. At the end of it all, he would argue that any civil servant, irrespective of his level, who succeeds in life, is a pen-robber!

Family Finance -Planning and Policy
The income of a Christian couple is better managed, using the economic tool of a scale of preference, with a clear boundary between the family needs and wants. It could come under the following Financial Policies:

Subsistence Economic Policy -In this home, all members of the family, including the children live on wages. They all contribute directly or not, to the Family Economy. For example, the child may have to play the gardener for a living in the home. As a girl, she may play the Nanny or Sales girl or something else!

Socialist Economic Policy -In this home, the couple, with or without other members of the family, contribute equally or otherwise to the upkeep of the home., Decisions as regards the family expenditure are taken by one partner on behalf of the other. The husband and his wife are joint owners of the family heritage.

Capitalist Economic Policy -In this home, there is a sharp division between the breadwinner and other members of the family. Usually, the husband is the breadwinner of the home. He dictates what should be bought, why, when and how! He makes sufficient provision for his home, without having to look up to his wife for any form of financial support. He sets up a business for her with the expectation of returns via the preparation of sumptuous meals, beautification of the living room and the meeting of other variable needs.

Communist Accounting Policy -In recent times, there has been a widespread propagation of the “common purse” or “joint account” policy of effective money management in a Christian home. Some couples have practiced this policy successfully while others have failed.

The Need to Tithe
Christian couples that desire to have surplus budget must be obedient to God’s commandment on tithes and offering. It should be the couple’s priority to separate one tenth of their gross income as God’s rightful due. In Malachi 3.8-11, it is explicitly stated that non-tithers are robbers of God’s treasury who are under the curse of poverty, lack and want! The biblical reason why many Christians toil fruitlessly is because of their disobedience to this commandment.

“You have sown much, and harvested little: you eat but you never have enough: you drink, but you never have your fill: you clothe yourselves, but no one is warm; and he who earns wages earns wages to put them into bag of holes…you have looked for much, and lo, it came to little, and when you brought it home, I blew it away. Why? Says the Lord of hosts”. Because of my house that lies in ruins while you busy yourselves each with his own house -Haggai 1.4-11

The Need To Save
The problem with some Christian couple is in their inability to save for their future. This is due either to insufficient income or wrong interpretation of Matthew 6.19 that: Do not keep up for yourselves treasures on earth. In both cases, these couples are wrong. In the first instance, if they could not save Ten Dollars out of every Hundred Dollars earned as income today, it will be impossible for them to save Fifty Dollars out of every One Thousand Dollars they might earn tomorrow. In the other instance, not laying up treasures here on earth does not refer to savings.

Treasure is a vested and acquired wealth or property in which one’s interests and desire incline to. Savings is something that can be conveniently put away for a period of time and for a raining day. Our world is full of uncertainties. Erosion, flood or fire disaster may destroy lives and properties. The child could be sick of fever. Parents, friends, or relations could make financial demands. Above all, the Church could call on us to give to charity and the cause of evangelism. Ellen G. White wrote that “We sin against ourselves when we are satisfied with enough to eat and drink and wear. God has something higher than this before us. Even though they may be poor, the couple who is industrious and economical can save a little for the cause of God, success and charity.”

It is not sinful to save. It can be sinful not to save. One hindrance to savings by the above stated couple is their faith in the belief that this present world would come to an end abruptly someday. But their ignorance is in the fact that this someday may not come in the next one hundred years! In this instance their savings would be a preparation for their old age. Also, other Christian partners and missionaries would need our savings for the continuous propagation of the gospel prior to the arrival of Jesus Christ.

Three vital questions to savings are: when should one start to save, how much should one save and, by what method?

1. Start to save as soon as you collect your first allowance. Salary, wage or gift. As a couple, begin the very first night of your wedding, especially with your wedding gifts and presents.

2. Save whatever you can conveniently put away, knowing that” little drops of water make a might ocean” Save at least five Dollars out of every fifty. Put aside a certain percentage of your income for a defined period of time to start a project, trade or purchase home equipment. For example, put away X Dollars every month for twelve months to buy a Refrigerator or Y Dollars monthly for twenty-five years, to build a house. It is possible!

3. Several other methods of savings include Property acquisitions. Buy don’t sell. Buy radios, television and video sets. Buy Refrigerators and Air-conditioners. But make sure you invest in properties whose value appreciates. They should have second-hand value. Besides, they must be materials that are needed at home for production purposes, not for showmanship. Put money into a fixed account. Save (y) Dollars every month for twelve months and then transfer it into a fixed deposit for five or more years. Buy shares in growing companies. Take a policy with a reliable insurance company. Go for life policy, Education fund. Buy landed properties for resale at a later date. Buy and refurbished cars for sale. However, be cautious. Do not save more than you can conveniently afford. Striving to save two thousand Dollars out of an income of Five Thousand Dollars may be frustrating!

Working Together to Manage the Family Finances

The ability to manage the family finances is a very important task to undertake on a continuous basis. Usually in each family this role will be lead by one of the parents and quite often this can cause a great deal of friction within the family. It is quite common that one parent is much better at managing finances and this parent should undertake the lead role to ensure that both parents work together to manage the family finances. Most of the time the parent deemed to be the better financial manager shoulders the main responsibility to ensure financial stability and if you are in debt, to be able to turn the families financial resources around to become either debt free or a more manageable level of debt. It goes without saying that both parents need the support and cooperation of each other to manage the family finances. This means that one parent cannot be saving and making sacrifices whilst the other is spending as fast as they can. Total commitment is required by both parents.

When you talk to your partner about a financial plan, particularly how to eliminate debts, make it a emotionless talk where you are outlining how the future can be better with rigor around financial management. It is possible that both of you have contributed to the current financial status, so it is important that the blame is not set at the feet of one person only. In every plan there should be checkpoints to see how you are both progressing and where possible small rewards to keep you going and to show the benefits of what you are achieving together.

Family Finances – Signs of Wrong Financial System in Marriage

1. Constant Quarrelling: You and your spouse do fight regularly about money shows you are operating on a wrong financial system. This shows that there is a problem financially. If you allow constant disagreement about money in your marriage, it will destroy trust and love in your home. Continuous misunderstanding in the area of finance at home is a sign that both of you and your spouse are not mature in the area of family finance; you need to improve on that.

2. You are Stingy: Stinginess is one way to make money work against your family. If you are too stingy that your family is suffering from the basic needs of life, despise the fact that you have sufficient money and you do not care about them. Note that there is a difference between prudence and stinginess. It is prudence if you decide not to buy a second phone or expensive clothes. But it is stinginess if you fail to pay your children school fees, pay house rents or buy food stuff for the family.

3. Family Replacement: You look for money at the expense of your family thereby replacing your family with money. If all you do is to look for money all day long with no family time, no time for your spouse or your children then money is working against you and you are working on a wrong financial system. The best gift you can give to your family is your time. How can you prove to them that you love them without spending time with them? Create time for your family.

4. Wrong Money Usage: There are good and bad ways to use money. If you spend your money to better the lot of your family and humanity, or you save and invest them, you are using money positively. But if you spend money on hard drugs, alcohol, immoral activities, or on criminal activities, then you are using money wrongly. There is no way you use money wrongly that it will not have a negative effect on your family.

Bisi Adewale is a family expert and president of college of marital success, an international conference speaker, author of more than 30 books on marriage and family life, host of family T.V. program called Family Booster.