Mom with two children

Make a Plan

Taking Charge of Household Finances

Being a mother can be demanding and thankless. After a day of juggling work, housework, kids and cooking it’s hugely tempting to leave things like family finances to someone else.

Yet mothers often have a much better idea about household expenditure, where savings can be made and how money might be better spent. No financial director would set a company’s budget without talking to the directors in charge of operations, procurement, human resources and other divisions, but often the person running a home doesn’t get involved in the household finances. It makes no sense.

If you do want to take control of the household finances, drawing up a budget is a good place to start. Simply get an exercise book and open it across two pages. On the left write down the household income.

Once you know what you have to work with you can start listing fixed expenses. Write these down on the right hand page. Fixed expenses include things such as rates, bond payments, rental and school fees – the costs that don’t vary much from month to month.

Below these list the variable expenses. Typically these will include transport, food, ‘phone bills. Look at old accounts or receipts to try ensure you capture all the costs and work out what the average expenditure is each month. It’s important to be honest with yourself and not underestimate.

The difference between the left- and right-hand pages will give you an idea of how much money you have left each month, or if you’re living beyond your means.

Using this initial budget as a basis, you’ll be able to start updating it each month with actual costs, building an increasingly accurate picture of your household finances month by month. Importantly you’ll start to see trends emerge, which will help you take better control of your finances.

If you discover you’re over budget or just scraping by, you’ll need to cut back on the expenses. Non-essential items such as entertainment or the luxury items you slip into the supermarket trolley are a good place to start.  

As you progress you can start to find ways of making more substantial savings by consolidating short-term loans and paying off and closing high-interest bearing retail store accounts.

Once you’re on a sound financial footing, try to put some money aside in an emergency or rainy day fund. This is a smart way of ensuring an unexpected expense such as a car breaking down or repairs to a leaking roof doesn’t upset your careful financial plan. Ideally you should try to build up a cushion of one-month’s income.

 The most important thing is not to procrastinate. Initially it may seem daunting, but taking charge of your financial affairs can be hugely empowering.

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