Budgeting for Family Expenses

When creating a budget, you might fine the majority of your funds go toward the family category. While you may not have a specific amount of money in mind when saving for ongoing family expenses or know what those expenses might look like in the future, simply understanding your budget and preparing for new costs will keep you on track with your day-to-day finances and long-term goals.

Some family costs you may want to save for include:

• Childcare –Wisconsin has some of the highest average childcare costs in the country. Having some money set aside to help manage care costs is a smart idea.
• Activities – Music lessons, swim classes, sports teams and more keep kids entertained but demand ongoing financial support.
• Education – College is the big cost to keep in mind, but you may also be interested in private school or additional educational lessons.
• Transportation – Whether it’s a bigger vehicle for your growing family or a car for your teenager, you’ll want to save for auto expenses.
• Technology– You may want or need to provide your kids with cellphones, as well as tablets or laptops for entertainment and education purposes.

What if you’re expanding your family? Despite the reality that a new baby will cost thousands of dollars per year, many families fail to save any money prior to growing their family.

Start planning now to be prepared for this big change.

• Create a pre-baby budget and a post-baby budget.Understand how you spend your money now and estimate how it will change.
• Grow your emergency fund now.Before you start covering new costs, focus on accruing a healthy amount of savings for the unexpected.
• Start saving for education expenses.It’s something that can fall down the list of priorities, but if you make it a habit to save for college now, the cost will be more manageable later.
• Keep saving for retirement.Don’t neglect your personal needs and goals, especially the long-term responsibility of retirement planning.