How to Start a Savings Plan as a Family

Getting a savings plan together as a family can seem like a daunting task, but with the right tools it can be a crucial asset. A savings account is vital for families because there is no warning when emergencies happen, plus it gives you money set aside for those rainy days. But as a family it can be hard to notice those incidents when day-to-day life is so demanding.

In the following sections are tips for how to start a savings plan as a family. You’ll thank yourself for creating this map to put away money. Sure it will be helpful when the car breaks down or the roof springs a leak. However, you can also save for a big family trip or paying off your home, which benefits everyone in your family.

Get the Whole Crew Together

First things first: get everyone together who will be involved in this savings plan. You need to gather up your partner, kids and other contributors. You want to get your family together because all of them will have an impact on hitting your goal.

To start off the conversation, ask everyone their thoughts on where family money is going towards, how each individual plans to contribute to the savings, and use it to educate everyone about why this plan is important. Yes, your five year old might not comprehend what is going on, while your sixteen year old might be more vocal about an allowance cut.

Having a financial conversation doesn’t need to apply just to your savings plan. Covering all aspects of finance together will ensure that nothing is lost in translation. Going over everything from retirement to college funds ensures everyone understands where you stand. Although savings may be the priority don’t let other aspects fall to the wayside.

If you’re executing this plan with your kids, pepper in some money lessons while building out the plan. Knowing ahead of time which grocery trip might be a lesson on price comparison will give you time to do your own homework to make the teaching moment more effective. Also, you’ll want to take the time to assemble a savings tracker for kids to check-off throughout the time period.

Assess Your Current Financial Standards

Once you’ve gotten your team game plan ready, it’s time for the adults to do their homework. You need to look over all of your finances, both income and expenses. Knowing where your money originates and how much money you actually have is the basis for creating what you have to spend and save. Gather up all the ways you make money: your job and side hustle, and really look at how much money you are pulling in. That will help you know your base line of what you have to bank or spend.

After you know how much money you have, look at where it’s going out. Record all your spending for a month to track where exactly does your money go. Collect receipts, look over bank statements and bills, and record cash spent anywhere. By knowing all of your expenses, you can start to determine how much money you can save. You want the most complete snapshot possible in order to know where you can cut back.

Speaking of cutting back, take note of where you can reduce spending. Gym membership sitting unused? Nobody watching Hulu anymore? Season passes to sporting events sitting by the wayside? Make a note and talk to the people in your family about what can be cancelled and put towards savings.

You need to have an understanding of your current financial situation in order to commit properly to a savings plan. Despite your best intentions, it doesn’t make sense to start a large savings plan if you need to pay off a debt or loan with high interest rates.

Get the Plan in Motion

You’ve done your planning. You’ve got your team assembled. And now it’s time to act. Rolling out your carefully constructed plan may seem like smooth sailing, but there are bound to be bumps in the road. You make feel like you’ve planned everything out, however life’s curveballs can come out of nowhere. Your child can have an extended illness. Your partner can lose their job. But don’t sweat it, reassess it. In the aftermath of these events, take a breath, and sit down again to reset your goal.

Aside from the surprises, track if you are meeting your goals. You can’t be sure that you’re hitting your target unless you check. An online banking tool can help you check-in on the go with your savings amount. Choosing the right banking service can also help you set alarms for when you are spending too much money or directly move money into a savings account as soon as you receive it.

Be flexible with your plan too. Yes, as mentioned before, surprises will happen, but sometimes you just need to spend some money. Maybe it’s a spur of the moment trip or your child picks a new sport. Being open to these expenditures will not only make your family happy, but help you test your ability to recover from an unexpected expense.

By following these tips, you can build a great savings plan for you and your family. Assemble your team, figure out your finances, and then execute your plan. You will fall down, but you can get back up. The important thing is to get going with a savings plan, so what are you waiting for? Start planning!