Helpful Strategies for Family Financial Planning By Dr. Bernice Wilson, Resource Management Specialist

Money can evoke lively discussions, and sometimes these discussions can lead to problems. In many families irrespective of income, age, or education, arguments about money are a major issue. Often the lack of money to meet basic living expenses is the root of the arguments. Money issues cause communication problems because many families do not discuss money, although everyone spends it. Spending decisions affect the entire family, so talking about money during family meetings, conferences or discussions only makes good sense. Besides, communication helps the family to share concerns, to decide what alternatives are available, and to decide what actions are necessary to address family concerns.

Attitudes about money serve as a foundation that guides our thoughts and ideas about money. Values determine how we live our lives and are reflected in everything we say or do, including how we spend money.

Here are some helpful strategies to develop sound money management practices.

1. Know how much income is available to the family.
2. Develop a flexible spending plan to relieve stress, and then stick with it. Pay yourself first and save money for emergencies.
3. Pay bills on time to save money.
4. Make a list of the bills for payment by the due date.
5. Keep track of your expenses. Know where your money goes you to determine if you spend money wisely.
6. Take immediate action when your income is reduced to stop excess spending.
7. Plan meals around the food you have on hand until your income increases or additional money becomes available.
8. Practice good health habits to cut down on illnesses
9. Plan the use of your car to reduce the amount of driving, thus saving on gas.
10. Take inventory of each family member's wardrobe to determine what items need to be added or replaced.
11. Compare price and quality of the clothing you buy.
12. Choose recreation and leisure activities that are free or inexpensive such as a picnicking, visiting a museum, or attending a free concert.
13. Check the interest rate of a loan or credit card. Try to use a credit card for emergencies or job-related expenses only.
14. Contact your creditors and work out an agreeable payment plan or some other solution if circumstances prevent you from paying your credit responsibilities on time.
15. Stop using credit cards if you want to get out of debt.
16. Do not take on new debts or charge any items you cannot pay off in a month. If your financial difficulties arise from too much debt or an inability to repay your debts, a credit counseling agency may work out a debt repayment plan for you.

A debt repayment plan does not erase your credit history. Under the Fair Credit Reporting Act, accurate information about your accounts can stay on your credit report for up to seven years. A bankruptcy can stay on your report for 10 years. Debts are either secured or unsecured. Secured debts are to an asset like your car for a car loan or your house through a mortgage. If you stop making payments, the lender can repossess your car or foreclose on your house. Unsecured debts are not tied to any assets such as bills for medical care or signature loans and debts for other types of services.

Following these helpful tips can help your family to stay on the right track and develop healthy money values.

References

Dollar, P. (2001). Family communications about money. The University of Georgia and Ft. Valley State University. Cooperative Extension/ The University of Georgia College of Agricultural and Environmental Sciences and the College of Family and Consumer Sciences.

Rupured, M. (2000). Fiscal fitness: Getting out of debt. University of Georgia, College of Family and Consumer Sciences Extension.

Tressler, C. & Rupured, M. (2000). Debt repayment plans. University of Georgia, College of Family and Consumer Sciences Extension.