Financial Education Center

Managing a Family Budget

It sounds simple: spend less money than you make. But as your family grows, costs have a way of creeping in a lot faster than cash. And even though we’re constantly being reminded of how financially freeing it is to create a budget and track spending, doing so may feel restrictive—especially at first. But rest assured, that feeling won’t last once you get going. Budgeting is being fully aware of what you earn, what you owe, and where your money is going. Ultimately, a budget gives you control over your money. Here are some proven strategies to help you manage your family’s budget. The moment you decide to take charge of your household spending, you’ll be on the path to a future filled with choices.
  1. Make a list of your family’s financial goals. Some common goals may be to pay off credit card debt, create an emergency fund, build retirement savings, pay down a mortgage, simplify your life, or save for college. Write down your goals and be as specific as possible. Re-evaluate your goals regularly and adjust as needed. Achieving financial independence in life is about setting good financial goals—and having a plan to achieve them. Once you have a plan in place, working toward those goals becomes easy, especially as you build momentum.
  2. Track your monthly spending. This easy habit keeps you aware and accountable of all money going out. Pick a day (it could be today or the first day of the coming month) and commit to writing down everything you spend for an entire month. Have your partner do the same. You can use a spreadsheet template, a simple sheet of paper, or an app such as, which allows you to customize your budget and even get weekly alerts of your status. Tracking keeps you honest. It highlights spending weaknesses. Best of all, it gives you a starting point for monitoring your progress.
  3. Create a budget that feels right. You don’t want it to be so tight that it creates unnecessary stress and causes you to abandon ship, but it should give you pause and challenge the way you spend. That’s why tracking your spending for at least one month is so important. It helps to create a budget that you can realistically adhere to. Try to follow the 50-20-30 rule, which splits your after-tax, take-home pay into three subsets. Here’s a breakdown to consider: 50 percent for needs including rent/mortgage, food, bills, minimum debt payments and other essentials. 20 percent for financial goals such as savings and investments. And 30 percent for dining, entertainment, etc. If you have a lot of debt and high expenses, you may need to adjust the rule to 80-10-10 until you’ve reduced your debt and grown your savings.
  4. Discuss needs vs. wants. You need to eat, but there are plenty of ways to get that food without stressing your budget. Create a list before heading to the store and stick to the list. And never go grocery shopping when you’re hungry. recommends families try to go an entire Saturday and Sunday without buying anything. “Eat what’s already in your refrigerator,” the site recommends. “Instead of going to a movie, watch one on TV or read a book or take your kids to a park or play board games with your family. Not only will you save money, you might discover some of the better things in life really are free.”
  5. Get everyone on board. Call a family meeting and discuss your plan for establishing a family budget. Get each person’s input on what they would like included in the budget (a vacation, a summer camp program, new clothes, etc.). Allow each person the opportunity to share their ideas on ways the family can reduce spending. You may have a teenager who enjoys cooking. Let them research affordable recipes and help plan meals. Consider everyone’s wishes and find creative ways to get needs met. Bonus: By being open and collaborative, you are teaching your children valuable lessons on money management that will carry them forward into adulthood.
Look to your local bank for a variety of tools to help make saving easy, including savings accounts for you and your children, retirement accounts, debt consolidation loans, debit cards, services that help you automate savings, and more.