OK. It is the day after Christmas, heading to the New Year and new, New Year's Resolutions. Before you break out the Sharpie and commit those to personal growth opportunities it is time to get everyone in the house involved with Managing Money!
For us, when one person has to be the Budget Police it is doubly hard to make it. One person feels the whole burden on themselves and resents the others not participating, and those being dictated to on how/when to spend, resent being treated like a child. I truly believe this is a key reason people fail, it sure has been for us. It isn't just us either, Dave Ramsey devotes a whole chapter to it in his book "Financial Peace."
But I don't think Ramsey goes far enough. I believe that you have to get the whole family involved, down to the smallest ones who have a basic understand of what money is and does. If followed, my hope is to instill "cause and effect"understanding to them regarding finances.
Budget - First off, don't use the word budget, like you do grounded! It cannot be presented as a punishment, but as a way of life! Have a budget that everyone has a part in building. Once all of the "must-haves" portion of the budget is ready gather the family and have everyone apply some group-think to the remainder, if any. For example: Is it more important to the family to dine out or rent/buy DVDs? By asking the question, you get buy in. This is so important when the question comes up, "Why can't we do X?" If you are in a situation where only basic musts are covered by the budget, I believe it is important to make sure everyone, without installing fear, understands the financial situation. Trust me, they know there are issues, and if you don't tell them, they will make up something worse in their heads!
Ramifications - What if we beat our number? We take our "Overflow" out every month and put into a fund for Holiday Fun, extra decoration or other Family Fun. The family earned it, they get to put it to what they want! Want to get your kids to turn off lights/TV, etc.? By doing this we have said $x is what we have for our Electric Bill, if we beat the number it goes into the fund, if over it comes out of our other areas like Dining or Entertainment. The first month they were great and we saved enough to buy some extra Halloween decorations they wanted. This month we were over and dining was cut! Already my 7 and 10 year-olds are running around and chastising anyone that leaves on a light!
Please understand these are just things that are working for us. Personal Finance and Managing money is so much less of a chore when everyone pitches in.
Pt 2 tomorrow...