Have you ever prepared a budget for your family? It is a valuable experience for sound financials of the family. And I’m talking about a real budget with detailed items, covering for all expenses in the family. I started to do that several years ago, when I was trying to make some investments for my future. I had good income, but I was not clear how I was spending the money. So, I decided to start budgeting and monitoring monthly expenses of my family.
I understand finances, due to my professional background, but the process of building a budget for my family was not as easy as I thought in the beginning. It took me two full months monitoring of everyday expenses in order to understand the structure of my family budget. Then, I spent three more months of planning and monitoring to be able to reach to important conclusions about our cost of living. I was able to answer questions such as: What are the expenditure items that are costing us more? How much money do we need to live in three scenarios: worst, normal, optimal? What is the distribution of our family expenses? How much was costing us our lifestyle?
Once starting the process, I kept going and ended up preparing my family balance sheet. This part was even more difficult, because I could not be cold enough to evaluate our properties with real market value. They were part of my memories and lots of efforts for making the money to buy them. It is not easy to accept that something dear to you is depreciated in its financial values over years. By the end of the process, that two-page document could tell our family story. In that particular moment I knew exactly what was my family net value. And, I’m not telling you how I felt. I’ll keep that feeling for myself as it is deeply personal.
If you ask me today: Was it worthy the whole family budget process? My answer would be: Definitely Yes. It is an illuminating experience that could help re-prioritize our actions, lifestyles and our lives points of view. No book or other reading allow us to have such a deep understanding of what is going on with our life and our money. My advise is for everyone to go through this process for own families’ finances. You’ll chide me in the beginning, but I’m sure you’ll all thank me in the end.
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