The Family Budget: Making it Work

I confess, I'm a bit of a nerd when it comes to money. I like to have a neat family budget, with all bills, spending categories and income sources duly noted. I allocate the money, my husband looks it over, and together, we try to stick to our family budget each month. Oh, I wasn't always this way. In fact, I'm still paying off the credit card debt we incurred before we read Dave Ramsey's Total Money Makeover book.

I look back in annoyance with my old ways of handling money and the cavalier way we added so much unnecessary debt to our lives, but I try not to dwell on it. Following Dave Ramsey's suggestion, we now make a spending plan each month, a “zero-based” budget. The amount going out has to equal the amount coming in, with a net of zero. Yes, you still save money and even invest (when debt-free) but that is part of the family budget and counts as outgo.

As a work at home mom (WAHM), a careful budget is especially important because I want to make sure the time I'm spending earning an income is going to good use. Knowing how precious my time is, wasting money on things we don't need bugs me more now than when I had an office job and no kids.

So how do you make a family budget friendly enough for a skeptical spouse and reluctant teenagers? Start by getting your spouse on the same page so you can tackle the rest of the family as a team. Make some time each week to discuss finances with your husband. Try these resources together:

*My Total Money Makeover

*Financial Peace University

*The Envelope System

With your spouse, plan out a family budget you both can live with. Allocate the set bills first, as that is easy to do (your monthly housing and debt payments should be consistent, and use the average for fluctuating electric bills and the like). Next, your disposable income. Include:

• Food (estimate $100 per person per month to start)

• Transportation (gas & oil, tolls, bus fares)

• Clothing, shoes

• Tuition, dues, subscriptions

• Household (cleaning products, repairs)

• Extra money (gifts, personal, etc.)

If you find your outgo exceeds your income, you need to Earn Extra Money. Also check out How to Save Money and Get Out of Debt.

If you have older children, it's time to get your teens on board. It's essential that you be open with them and ask them to pull together as a teem to make the family budget work. Older teens with jobs may need to pay for their own gas and clothes and even contribute something to the grocery budget, especially if you and your spouse are trying to pay off debt and get finances in order. Younger teens and children can help with extra chores if parents will be working overtime or from home to increase income.

What successes--or pitfalls--have you experienced with a family budget at your house?

Personal Finance as a Work at Home Mom

Many personal finance sites tend to focus on one end of the money equation: how you spend and save it. But in my blog, I'm focusing mostly on the other end of the equation, earning money. Specifically, I write about earning money as a stay at home mom and the unique challenges this situation presents.

When looking at a tight budget, there are two things you can do to improve the wiggle room and find money for underfunded categories (whether it be your blow money or your debt reduction).

1. Make more money.

2. Spend less money.

Really, it is that simple. You can do one or the other, or both, but those are your only options. (a huge inheritance just isn't practical for most people, and not something you can control in any case... well, let's just not go there.)

There comes a point for many people when it is easier to do the first than the second, and this is certainly true in my case. With two mortgage payments,a home equity loan payment, student loans and more, much of our monthly income is eaten up by set bills that we can't change (unless our house finally sells, but that's another post for another day).

We are very frugal with our so-called disposable income. We buy natural food in bulk, bake our own bread, plant a garden, drive old paid-for vehicles, shop at thrift stores whenever possible, and don't have TV, cable, or other entertainment extras.

To supplement my husband's income and pay for my children's Atrium class, among other things, I spend part of my day working from home, as an English grader and a freelance writer. There are many other ways to earn extra money. Here are a couple short articles with ideas for you:

How to Earn Extra Money & How to Earn Extra Money at Home on a Computer.

Making Money with Affiliate Programs

Some people make a living marketing other peoples' stuff online. One is the author of The Super Affiliate Handbook: How I Made $436,797 Last Year Selling Other People's Stuff Online, a book that purports to show you how it is done. I don't have $75 for the book, so I am learning as I go.

I am now an affiliate for Amazon.com, eBay.com, Half.com and The Coupon Clippers. I've started posting the links on my blog, forum signatures, and articles I write for other websites.

I earn about $20 a month from Amazon, without much promotion at all. Most of my purchases are made through some plain text links on another site (not this blog).

For me, becoming an affiliate marketer allows me another opportunity to earn passive income, my new hobby. I spend a few minutes creating text links, add them to my articles or posts, and leave them alone. I log in to my Amazon Associates account a few times a week to check on the progress and am pleasantly surprised when a sale shows up.

However, I haven't made more than $5 on any one item and was slightly jealous to see that many Amazon Associates have had commissions of $100 or more on a single item. One associate mentioned selling a $1,000+ watch and earning a large commission for it. That would be nice, but for now I am content to build up my traffic and hope my referral links get the clicks.

I'll let you know how my progress goes, so keep an eye on my blog for an update.