Money Management

Different families handle budgeting and money management in different ways, but the general goal of money management is a weekly, monthly or yearly picture of what you need to spend and what you have left over.

Budgeting will help you:

• spend your money wisely on the things you must have – these are your needs
• save money for the things you dream about – these are your wants
• set aside money for unforeseen expenses
• stop accidental overspending.

Working out how much money you need for everyday essentials like housing, food, utilities like electricity, gas, water and phone, medical services and transport helps you make sure you have enough for emergencies and unexpected expenses.

After you’ve accounted for the essentials and the emergencies, the aim is to have money left over to buy some of the things you want, as well as to save for your long-term goals.

Having a plan for managing your money will help you and your family avoid getting into debt. It can also help you get on with being a family, rather than spending too much time on financial stresses.

The key is sticking to the rule – never spend more than you earn.

One way to start is to make a table listing what you have and what you spend or owe. This is called a budget.

A long-term budget will include:

What you have

• Your income per week, fortnight or month
• Bank accounts
• Superannuation statements

What you spend

• Average bills per week, fortnight or month, keeping in mind that some months you might spend more than others
• Mortgage or rent payments
• Any other money you spend
• Your credit card payments
• Any other debts

Try to budget a specific amount for savings, fun, leisure and personal expenses and then stick to it (which is usually the hard part!).

One of the hardest things about making a budget and managing money can be keeping track of what you spend. Looking over previous bills can help you estimate what you spend over a week, a month or even a year.