To create a beneficial financial plan that covers most of a family’s concerns, you should start with these seven areas: house payment, household maintenance, food, education, insurance (automobile, home and health), retirement and entertainment. Of course, there are additional areas your family may want to consider adding. The items listed generally cover all the needs of most people.
1) House Payment
Your living arrangement could involve living with family or living on your own as the head of a family. Whichever situation you find yourself in, you should have a budget and a spending plan. This may be to improve your living situation or to simply maintain it as things change throughout your life. If you are about to buy your home, you’ll need to consider how much you can afford and how much you want to spend.
You may be able to afford a $250,000 home, but it would curtail your travel plans each year. Therefore, you should opt to buy a less expensive home unless you anticipate an increase in income coinciding with your purchase of the home.
- Household insurance
Each household has a means of keeping their home in order. Family members have weekly chores and the family may employ the help of a gardener or a maid. Depending on the plan and the cost, the allotted responsibilities keep the household functioning to the family’s standards.
- Travel to and from work, religious services, healthcare providers and school must also be calculated.
- Toilet Paper, Paper Towel, Cleaning Fluids
- Family members’ allowance
- Gardener’s pay
- Maid’s pay
- Miscellaneous pay to hired workers
- Miscellaneous Materials needed to repair home
- Car Note
- Car Maintenance
3) Food and Health
Food choices are important as they determine the short and long term health of the family. Supplements may also be added to this category. About three-fourths of the Americans has an eating pattern which is low in vegetables, fruits, dairy, and oils while less than a third of Australians meet the recommendations for grains and cereals.
All the food groups should be included, which guarantees your family would be exposed to a healthy diet. Eating well can only keep you healthy if you see a doctor regularly to prevent the disease from hurting your family. So, you must factor in health care costs.
- Vitamins and Supplements
- Dental Appointments
- Primary Care Examinations
- Eye Appointments
Today’s family has options for obtaining an education. Traditional brick and mortar schools as well as studying online and education through books and videos.
Another aspect of living is the possibility here that life gets interrupted and ends prematurely. When this happens to the family breadwinner, the dreams and hopes of other dependent family members can come to an end. Insurance protects the family from unexpected disruptions such as death, ill-health or the destruction of property. Life, home, health and automobile insurance can provide that protection.
- Life Insurance
- Health Insurance
- Homeowner’s insurance
- Automobile Insurance
The average person doesn’t consider planning for retirement until they reach the age of 50 or older. Consequently, most people do not have an easy plan for reaching an ideal sum to sustain themselves for the full length of their retirement. The average number of years a person lives after retirement is 15 to 20 years. That translates into the amount needed to maintain your life immediately prior to retirement times 15 to 20. If your annual expenses were $35,000 and 67, then they would equal that each year thereafter. You would need between $525,000 to $700,000.
- Monthly retirement savings (based on interest earned and the time before retirement).
The last thing to consider budgeting is weekly, monthly and/or annual entertainment. you may be planning a vacation or wedding or attending a concert.