Money doesn’t, unfortunately, grow on trees. If you have a family, keeping your finances in check is essential and it can be difficult to know where and when to start. If you want to ensure your family finances are in order, take note of the following easy steps and tips.

Understand your income and expenses

You should first take a moment to understand the household income and expenses. The idea is to have a clear picture of how much money you have available each month and the breakdown of where the money is coming from. Furthermore, you should note which of this income is relatively secure (i.e. a permanent position with a three-month determination clause) and which of it can fluctuate more (for instance, rental income from a holiday home).

Once you have sorted out the income, it is time to start exploring your household expenses. Surprisingly large amounts of people don’t actually have a clue of the real spending per month and you ought to get out of this group. It’s a good idea to check your expenses at least every six months to keep an eye on whether you’re suddenly spending a lot more money on a specific activity.

When studying your expenses, divide your spending into smaller groups. You want to have the ‘essential’ spending and ‘non-essential’ spending separated. The essential spending would include things like mortgage, electricity, insurance, and phone tariffs. The non-essential should include things like entertainment and eat out.

If you notice your expenses are barely covered by the income, you have a problem and you need to start finding ways to cut spending.

Become a smarter spender

Instead of just paying for your utilities without thinking about it, start being a smarter spender. There can be huge differences in electricity prices or broadband costs. You should regularly check with price comparison sites and with the service providers directly whether you are getting the best possible deal. Dedicate one day every six months or once a year to check for prices and changing service providers if required.

In addition, when you are about to spend don’t just opt for the first thing you see. Compare prices online and take advantage of promo codes available from various sites. If you look around and research your shopping, you can cut your expenses. It’ll take a bit more time, but once you learn the tricks, your smarter shopping choices will become automatic.