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Simple Financial Hacks That Work For Busy Families

It’s a fact: raising a family is expensive. According to the latest stats, the average cost of raising one child from birth to their 18th birthday costs parents $233,610. That breaks down to about $1,081 every month per child.

Parenthood changes your life in a lot of ways. You’ll face sleepless nights, dirty diapers, and an empty wallet. If you’re one of the many parents struggling to balance their finances, use these life hacks to stay out of the red.

Become financially literate

Financial literacy is the foundation of good finances. Without it, you won’t understand how your money, financial products, or the market works. When you don’t know how these work, the chances you’ll make bad financial choices multiply.

To prevent making bad choices, make financial literacy a goal for the whole family. Use financial tips and information about financial products to learn how things like compound interest, risk diversification, and inflation affect the payday loan, line of credit, mortgage, and mutual funds you pick. Once you have a basic understanding of the average chequing and savings account, loan, and investment, you can teach your kids about finances. Help them tackle basic numeracy and simple concepts like budgeting and saving. When you start their financial education young, they’ll be better prepared when it comes time for their first job (and their first year of taxes), their first credit card, and their first student loan.

Make a household budget

A household budget brings order to disorganized finances. It’s an essential tool for busy families because it helps them cut down on unnecessary spending habits that limit their ability to save or pay off debts. At the start, you’ll want to track your expenses for the past three months or more and categorize them into types of purchases. Housing, utilities, and groceries are all categories of their own, as are clothing, entertainment, and haircuts. The more accurate your tallies are for each category the better your budget will work, so make sure you don’t leave out anything.

Once you’ve tallied everything, you’ll have a bird’s eye view of your finances. This macro-perspective can help you identify categories in which you overspend constantly. A budget can bring to your attention bad habits, like spending too much on takeout, banking fees, or monthly subscriptions. When you can cut out most if not all of these unnecessary purchases, you can free up more cash to go towards things you really want, like bigger savings, lower debt, or a nice family vacation.

Get organized in the kitchen

Depending on the size of your family’s appetites, your grocery bill can be one of the biggest expenses in your budget after housing and utilities. This bill also depends on where you live. For families in the States, they can expect to spend anywhere between $146 and $289 each week at the grocery store, while families in Canada average out to about $220 per week.

A meal plan is a simple organizational tool that can help reduce your grocery bills. It helps you figure out what your family’s eating at every meal during the week, so you can avoid restaurants and drive-thrus. It also helps to eliminate food waste as it forces you to think about how you use your food.

Buy and sell on the second-hand market

There’s a special feeling that comes with buying something shiny and new straight from the stores, but it’s often tinged by dark thoughts of how much you spent to get it. Luckily, you can get what you need without paying full price by tapping into the second-hand market. Websites and apps like BUNZ, KidZone, and Kijiji are digital communities for parents just like you. They provide a convenient place to buy, sell, or trade gently used items. You can find everything from household wares to clothes to books on these sites, so take the time to explore what they have to offer. It’s a win-win; you get to pay less for used items, and people looking to sell their stuff earn a bit of cash for things they don’t need.

Kids are expensive. Most parents know this, but now the data confirms it. If you expect to keep your finances out of the red as you raise your little ones, you have to be smart with your money. Find and use financial hacks that work with your lifestyle to raise happy and healthy kids without going broke.

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