Tips on Preparing the Family Budget continuation

As I mentioned in my previous post, H and I are helping out with the
Singles Engagement Retreat. In the last retreat, we got a request for
tips on budgeting.

This is the continuation of List #2 - Tips on Preparing the Family Budget

6. Decide to tithe. Tithing means allotting the first 10% of your earnings
to your church and/or religious community. It serves as a reminder that
the family’s wealth is first and foremost a gift. Everything is just “icing on
the cake”.
7. Decide to set aside 20% or more of your earnings for savings
and investments. Yes, you have a right to enjoy the fruits of your hard
work. However, you must remember that additions to the family, the
education of children, sickness, retirement and emergencies are all facts
of life. It would be wise for your family to prepare for all these. Banks,
insurance companies, mutual fund companies, the stock market,
entrepreneurship, franchising, etc are some of the ways you can maximize
your savings. How much do you expect to earn? How soon can you expect
your earnings? What are the risks involved? How long will your money be
“tied” to the investment? What are your options if you need the money
sooner? Are you comfortable with the terms and conditions? Etc etc etc.
Again, do your research. A friendly warning, if it seems too good to be true,
it usually is.
8. Eliminate bad debts. Credit cards are okay but be sure to pay for
the entire bill on or before the due date. The interest can put you in a
serious debt hole. If you must borrow, do so because it is for an investment,
you are happy with the potential returns and more importantly, you’re sure
you can pay for the loan if things don’t work out. Avoid borrowing for a
“splurge item.” Save up for it. Or better yet, allocate earnings from an
investment. In this way, you can be sure that the “splurge item” is something
you can afford.
9. Avoid lending money to others. It has been said that when you lend
money to a friend, you risk losing both your money and your friend. If you
must lend, consider the possibility that you will never get your money back.
Instead of lending money, others have chosen to donate instead. This is with
the consideration that there is an emergency and you have money to spare.
What to do with people who’ve developed an unnecessary financial dependency
on you? “Tough love” is needed when a person is capable of earning but has
just chosen not to do so. You are doing yourself, your family and the other
person a favor by encouraging them to be financially independent.
10. Last but not the least, trust each other and make all financial
decisions together. No secret bank accounts please. It says a lot when you
cannot trust your spouse with your money. Bear in mind that more important
decisions might need to be made in the future. If you are not yet at that level,
now would be a good time to start working things out.

There are no guarantees in life. The probability of success is simply greater
when God, the husband and the wife work together.

I'm putting the sample budget in my next post. See you there!