Ultimate Family Financial Guide

Young family walking down sidewalk

When you’re starting a family, planning for its financial future is among the most  important—yet challenging—responsibilities you’ll experience as a parent. If you want  to help your children pay for college, for example, or maybe you plan on buying a  bigger home to expand your household, you know that the earlier you start saving, the  better the outcome! 

As a young family, it’s normal to feel like your finances are pulling you in all different  directions. So, it’s understandable if you’re unsure of where to begin. 

Step 1: Create a Family Budget Plan 

Creating a family budget helps you prepare for life’s many curveballs. It also provides  you with peace of mind, so you spend less time worrying about paying bills and spend  more time together as a family.  

Let’s also not forget that creating a family budget now will help instill good financial  practices into your children’s savings/spending habits that will, in turn, benefit them as  they get older and start their own families.  

5 Family Budget Planning Tips  

To help you get started, we’ve compiled a few tips to help you start planning and start  saving for all of life’s little—and big—moments ahead.  

Make It a “Family” Budget 

What we mean is, make sure that each member of the family plays a role in creating the  budget. You can do this by holding a family meeting to discuss your current financial  situation and your personal and family goals. 

Involving kids, depending on their ages, into these discussions can be a powerful  motivator for you to work towards your financial goals, too, while teaching them healthy  financial habits, too.  

Ask everyone to write down on paper at least 3 goals they have for the future. Some  may include: 

  • Having another child (or sibling)
  • Taking a family vacation
  • Buying a new house
  • Adopting a family pet
  • Joining a school’s hockey team
  • Purchasing another vehicle
  • Taking music lessons

Openly discuss your goals and dreams with one another, so you can work on creating a  financial plan that will support you in achieving them. 

Separate Your Expenses 

This part sounds scary and complicated, but once you’ve openly discussed your goals  and financial situation, it’s time to see where some of your money is going each month. 

Begin by identifying all of your outgoing expenses. It’s recommended that you separate  these into two categories: 


  1. Essential expenditures: Mortgage or rent; groceries, utilities, prescriptions, insurance, clothes, gas, etc.
  2. Non-essential expenditures: Monthly subscriptions (i.e., Netflix, Hulu, Blue Apron, etc); takeout/delivery; electronics; alcohol; etc.


By doing this upfront, you can easily identify an area (or two) where you’re excessively  spending on items you can live without. Spend time finding places where you can cut  back, especially if you have outstanding debts. Any money you free up is money you can  invest back into your family.

Include an Emergency Fund 

Creating a rainy-day fund is more crucial than you realize. This is especially true if you  have outstanding debts, as it helps break the cycle of relying on credit cards to cover  unexpected expenses.  

By building an emergency fund into your family budget, you’ll provide your loved ones  with a safety net for if, and when, the unfortunate happens, such as losing a job, having  to replace a car, becoming ill or injured, etc. Your emergency fund should be able to  cover at least three-to-six months of your family’s expenses to ensure your family can  afford the necessities. 

Don’t Ignore Your Debt 

If you have any outstanding debts, such as credit card debt or student loans, make sure  you are actively working to pay down your debt and it’s represented in your budget  plan.  

By reducing the amount of debt you have, you free up money in your budget that you  can allocate in a way that better benefits you, your family, and your financial future. It’s  important to be aggressive in paying off your debts, so that you give yourself more  opportunities to save and invest in your family. 

Keep the Future Your Focus 

We already mentioned planning for the unexpected, but in addition to making sure your  family’s covered if you were to become ill or lose a job, you also want to make sure that  your finances are in order in the event of your passing. 

There are two aspects that you’ll want to consider when planning: life insurance and  estate planning. 

  • Life Insurance: No matter how healthy you are, enrolling in a life insurance plan  is the best way to protect your family, especially if they heavily rely on your  income to pay for necessary expenses. Paying for life insurance is an affordable  way to safeguard your family, and, in most cases, a basic-term life insurance plan  will suffice.
  • Estate Planning: A key part in planning for the future is completing the proper  estate planning documentation. Most often, this includes creating a clearly  defined will, designating beneficiaries, and protecting your assets. A financial planning advisor can walk you through the crucial documents you should have in  place to assure your family is protected. 

Plan to Contribute to Retirement 

When debts are paid off and your affairs are in order, there’s another important  component to include in your budget spending: your retirement plan. Putting money  into a retirement plan (e.g. 401k, Roth 401k, 403b, etc.) is one way to protect your  family’s financial security for the future. The sooner you begin contributing to your  retirement, the harder your money will work for you—earning you interest as it sits in  the account.  

In many cases, employers offer to match contributions up to a certain percentage; take  advantage of any contribution matching your employer offers, as it is free money in  your future pocket. 

It’s important to make healthy contributions to your retirement before considering other  investments, like college savings for your kids, as there are financial aid or student loan  options that are available for higher education that aren’t available for retirement. You  can always consider establishing a college savings account (e.g. 529 College Savings  Plans) for your kids, where you, friends, and family can deposit money as birthday or  holiday gifts that don’t initially take away from your retirement savings goals. 

Need More Family Budget Planning Tips? 

Working with a financial planning advisor can help alleviate some of the burdens of financial decision making. 

At Focus Financial, our experienced team of financial planning advisors can help you  create an individualized, comprehensive financial budget plan that is tailored to your  family’s needs and goals. Your family’s financial health is our priority, and we are here to  help you navigate these tough financial decisions.

Contact us today to find a financial advisor and to learn how we can help you  strengthen your family’s financial health, today and for your future.

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