The holidays are quickly approaching. While this is my favorite time of the year, it is also a stressful time of the year. With all of the parties, gifts and everything else going on, all I see are dollar signs.
It is very easy, especially for me, to get wrapped up in the spirit of the holidays and forget about the bottom line. As the holiday season is upon us, I have decided to focus on Financial Responsibility and make sure my family’s needs are met, our goals for the next year are going to be reached, and make sure that we are keeping control of our spending.
In order to take Financial Responsibility for my family, I need to look to the four cornerstones of money. They are the following:
- Goal Setting – Deciding what is important to my family, what our money should be used for in the present as well as what our future goals are.
- Budget Tracking – Tracking what we are spending money on as well as setting a budget for my family to follow.
- Cutting Costs – Once you know what you are spending money on, you need to work to see if there are areas where you could be cutting costs.
- Savings – Once you figure out where to cut costs, you must have a vehicle to save your money away from your basic spending accounts to make sure that your money is actually being saved.
Over the next four weeks, we will be discussing the four cornerstones of financial responsibility and setting yourself and your family up for financial success.
In this installment, we are talking about Goal Setting. Goal setting is very personal – for you and your family.
My husband and I have spent a lot of time over the last month deciding what our goals for 2015 will be. We recently sold our primary residence and are currently renting while we decide where we want to live. Our current lease is up at the end of April and we are focused on purchasing a new house at that time, providing we know where we want to live.
As this is a short term goal, we have taken a few steps. First, we identified what funds we have available for the down payment and closing costs. We then spent some time with our finances to determine what our monthly payment should be to figure out what amount we could afford for a mortgage. Based on this, we determined that we are 3/4 of the way to a down payment. We also have 5 months to come up with the balance.
This gives us an amount we need to put away each month. We are currently putting away 55% of what needs to be saved each month into a savings account as a direct deposit from my husband’s paycheck. Now, we need to almost double that amount of savings. This is where Week 2 and 3 come in – we need to track our budget to see where we are spending and find ways to come up with the rest of the savings we need.
This week, sit down with your family and determine what your financial goals are. Do you want a larger emergency fund? Is there a vacation you want to make next year? Do you need to save for a baby? Write down these goals and start researching what you will need to save to reach these goals. Break it down to a monthly number by dividing the total amount by the number of months you have to save the money.
Miss Part of the Series?
[pcig category=financial-responsibility show=post_title links=subcategory_name,post_title order=asc orderby=title]