Amazing Ultimate Guide To Effective Family Finance Management

Every family needs a good guide on how to manage finances. This helps the family not to spend more than they make and not to be in debt. Let’s have a look at the 5 management principles and 5 common mistakes in managing the family’s finances, as well as 8 secret tips to effectively improve your management.

5 Important Principles In Family Finance Management

1. Transparency

When living in the same house, using separate sources of income will get newlyweds into trouble. To avoid arising awkward situations later, the couple should disclose all sources of income, expenditure, and debt (if any) of themselves to each other.

This helps the couple to grasp the current family financial situation. After that, it is easy to distinguish common and separate financial resources and plan family financial management.

2. Create a detailed spending plan

To make a complete and detailed spending plan, couples should list and classify their expenses and the proportion of each expenditure on income.

Here is the principle of the 6 jars, considered the golden formula for effective spending management, introduced by author T. Harv Eker in the book Secrets of the Millionaire Mind. The 6 main jars represent the 6 main expenses of a family. Eker shows the proportion of expenses in income as the chart below.

Divide income into small amounts for better control of personal and family finances.

Divide income into small amounts for better control of personal and family finances.

Newlyweds can also adopt more optimal spending methods, such as buying in bulk (in bulk). To do this, you should refer to more companies following the Groupon model (Groupon = Group + Coupon). These companies encourage many people to form groups, buy the same items offered on the website to receive preferential prices, helping you save more money.

3. Monitor your budget periodically

After you have a detailed spending plan, you need to keep a close eye on your expenses. This helps your family not to be “excessive” when spending beyond the plan.

This monitoring is as important as planning. Because, if you make a plan without doing it right, the plan will be thrown away!

We recommend using a notebook or software to track your family’s income and expenditure.

4. Financial dispute resolution

In addition to understanding each other’s spending habits, the couple should also discuss and agree more on resolving financial disagreements if any in the future. The principle of equality and sharing should be put first.

5. Saving and investing continuously

Saving

Every family will have a lot of emergency situations that they themselves do not anticipate. At that time, the savings will be the lifeline for the couple. In addition, these savings can serve many different purposes such as buying big assets, seizing new opportunities, ensuring children’s education…

The savings that each person should set aside each month is usually 20% of income, like the 6 jar model that we introduced to you above.

Invest

Saving is definitely necessary and then investing, why is it important?

Surely you are not familiar with the concept of money making money anymore, right? Investing is one of the fastest ways to make money. This is an additional source of passive income for the family, you can use the income from investments to cover your married life, save or reinvest.

Only relying on fixed income sources is too difficult for husband and wife to balance income and expenditure, especially in urgent situations.

5 Common Mistakes In Managing Family Finance

1. No clear plan

No financial management plan will easily lead to uncontrolled spending, no reserve fund for the future, especially for children. In addition, in emergencies, the family will become troubled, which can cause disagreement within the family.

2. Do not track and manage expenses

Many families are subjective with monitoring and managing expenses or completely rely on the balance of the wife. There are many ways to monitor, it is important that the couple know how to work on this task together. Since we are living in the era of technology, let’s get used to monitoring and managing with utilities or software (apps) on phones for the whole families.

3. Disagreement on habits and spending

“You spend your sugar, I spend my sugar” or “you have to give me all the money to keep, it’s forbidden to have a separate fund”. Mistake!

Being too financially independent will be difficult to use for common purposes, or when there is urgent joint work, both husband and wife are not available. The lack of a separate account interferes with the other party in social communication, now going out without money is very difficult to manage.

Understanding the spending habits and needs of the other person to make it easier to set up a general fund, a separate account, then making a plan to manage family finance are all equally important.

4. No division of financial responsibilities in the family

Most of the couples 8x and earlier, the husband working, the housewife is the model, the division of financial responsibilities in the family is very easy. The husband is responsible for the family’s income. The wife is in charge of spending so that the expenses are appropriate and there is a reserve fund.

Nowadays, most couples have their own source of income. The sharing of financial responsibilities between husband and wife, if not clear, will easily lead to an urgent need for money without any available money because both have used up their income.

5. No reserve fund

Saving is extremely important. Read also the 5th principle above to find out why. Don’t fall into an unwanted debt situation because of a lack of reserve funds.

8 Tips To Effectively Manage Family Finance

1. Have a family expenses plan

Let’s start with planning. The monthly expenses should be less than the couple’s income. Planning will help you determine if you can eliminate unnecessary and wasteful expenses for your family.

2. Please consider carefully before buying

Before you buy anything, check prices and quality in many places to make sure you’re getting the best deal. Do not forget to read the reviews of the users first, then choose a reputable brand and address.

3. Take time to discuss with family

Take time to talk to family members about budgets and household expenses. Check that your current budget fits what you need to spend. Discuss removing unnecessary items or add if necessary.

4. Have a financial goal

Next, you need to set a financial goal to decide and organize the plan. Based on that, you will determine what needs to be prioritized and closely monitor your financial funds to achieve your goals.

5. Don’t ignore the extra costs

You should not only focus on the fixed monthly expenses but ignore the costs incurred. Each month, you will have different needs. For example, during Tet, you need to increase spending on house cleaning, clothes, food, fun activities, lucky money, etc. And the budget for this must be properly allocated.

6. Spend with purpose

Before spending money on anything, ask yourself what is the purpose: “Why buy this product?”, “Why pay for this service?”. Analyze the reason for each expense to make sure you’re on track for your goals.

7. Saving with a purpose

Just like spending, you should find a reason to save. If you know why you have to save (buy a house, buy a car, etc.), you will easily resist the urge to spend money.

8. Monitor your credit report monthly

Every month, you should take the time to go through your credit report. Be wary of credit loans because if you don’t pay attention, you will borrow more than you can afford.

Best Productivity Tips For Finance Professionals In Creative Business

Are you a creator who runs your own business? Or are you dreaming of joining the dynamic world of the creative economy, turning your ideas into a solid career? 

The thought of being able to pursue your passion and above all, make a living from it sounds indeed intriguing, but being self-employed has never been a rosy path for even the most enthusiastic and determined people. Many have been taking on the challenge only to find out that there is too much on their plate, and their creative processes are interrupted by the overwhelming amount of administrative work, including raising business funds, planning and allocating your budget, and accounting. 

Yes, financial management matters, no matter what kind of business you are in and however you would like to prioritize your creation. It also goes without saying that good financial management requires productivity, in both how it is productively practiced and contributes to productive outcomes of the business. This article provides useful tips on how to do finances with efficiency, so you will never have to slow down at your creative work.

What is productivity? And why is it important for your business?

Before digging in the ways to improve your financial management performance, it is necessary to be clear about the meaning of productivity in this context. Does it mean less time and effort are spent in completing one product, thus increasing the number of products created in a specific amount of time as we normally understand it? If this is the case, then what counts as a complete product? Should product quantity or quality be of more concern when we deal with raising productivity? 

You may or may not consider these rather theoretical questions before, but probably on some occasions you have found yourself snowed under with work, trying to multitask to save time but felt nothing is done at the end of the day. At times you may have difficulties in overcoming procrastination because it seems impossible to tackle any task without knowing the full list of what ought to be done and in which order. It is just like you are going to prepare a complicated dish but do not know the required ingredients or the cooking steps, so you eventually give up and seek easier options such as eating out or online delivery. These alternatives work well as short-term solutions, however, they often come at a cost (unless you can ask someone to do the cooking for you voluntarily for free!) that is not friendly to those with limited budgets.

Working productively, therefore, means you have to go through all the possible solutions in order to balance out the cost – benefit scale, that is, to come up with “an ultimate recipe” which can help you make use of your existing resources for business development. Moreover, it is through this process of weighing options that you can stay focused on the set goals while keeping good eyes on the current situation. Everything is in check, so you will also have better chances of successfully handling unexpected events and investing in your business system to improve the value of your products.

Creative businesses and the role of financial management

For creative business owners, the range of their products seems endless. Art-based enterprises, including art workshops, music publishers, companies working in the fields of film, design and architecture are among the first that may come across our mind. 

Nowadays, in the era of technology, creation can take various forms and shapes, from the computer software that is being used for writing this article to several multimedia applications which are becoming essential in everyday communication. Although the boundaries of creative businesses have been broadened than ever before, what they have in common is that they create products on the basis of intellectual capital.

At first, it may be hard to imagine the link between creative work and financial management if you associate the former with innovative, out-of-the-box thinking and the latter with matter-of-fact figures that spare little room for any adventurous idea. Here we are not implying that a talented artist cannot have a niche for numbers or vice versa (which is a huge misunderstanding because many of them are), but it is equally true that keeping track of income and expenditure, cash flow, and balance sheet is not normally one’s priority when creative time alone seems insufficient. Still, no one can deny the significance of good finance managing practices in any business, and creative corporations or even individuals are no exception.

First, it always helps to have a realistic picture of your business performance, and an understanding of the financial situation is crucial in this regard. Is your business making good profits? When and where is the money going in and out? What is the status quo of your enterprise in terms of assets and liabilities? Such questions should be asked frequently and the answers are to be sought carefully if the managers want their business to be sustainable.

 Working for passion is one thing, but creative business owners may need to keep their feet on the ground when it comes to finances. Individual artists and designers who run their own businesses, start-ups, or small and mid-sized enterprises (SME) which can’t afford a team of financial professionals ought to look even closer into monetary matters, making sure that all the costs needed to create their products are calculated and taken into account. Don’t overlook any unpaid labor or external subsidies involved in the production process if you want to keep things in order or simply to charge the right price for your creation.

Second, proper financial management is an essential factor to attract investment. There is no doubt that investors want to make sure their money is in good hands and their trust will have certain rewards in return, be it financially, socially or both. One of the most straightforward ways to prove the profitability of your business (or at least, its potential) is to provide investors with a well-planned financial statement which shows how you are managing your budget to make a profit. In the case of digital fund-raising financed by crowd or fans that are being used by many creative businesses at present, it is even more important to convince the investors – future customers that you are making good use of their support to create quality products.

5 Tips on productive financial management 

Now is the time for us to see financial management from a more ‘creative’ perspective. What can be done to innovate unproductive accounting practices that result in loss of time, money, and energy? The following 5 productivity tips are basic steps that any creative business can apply.

1. Use time wisely

Freelance artists or business managers, accountants or chief finance officials (CFOs), regardless of your position and workload, you are equal before time. Some people try to multitask to get ahead in the race against time while others take time to figure out their priorities – what urgent and important jobs they should do first and in what order. Do you see yourself in either type? Have you ever thought that you can save a lot of time by spending time on planning? Start with making your daily schedule which focuses on critical work items and seriously stick to it, you will see a whole difference in how setting a time limit for yourself can improve productivity. Self-reward when necessary, but also don’t go easy on yourself if the ‘deadlines’ are missed. 

2. Teamwork

Humans are the capital of creative businesses, and this is true in the case of financial professionals as well. The ideal is that everyone in the team should be building their capability over time and establish effective communication that enables them to exchange ideas and cooperate with each other to complete a task. However, in reality, it may be just as important to delegate because no one can handle everything at once. Rather than sacrifice your time to answer all the clients’ email or meticulously classify receipts and invoices, again, you’d better do high-priority tasks such as writing a good audit report or double check on the calculations and collected data for your financial plan.

3. Optimize tools

Financial and accounting platforms and tools have been introduced and utilized in recent years to free up labor wasted on repetitive, time-consuming tasks in financial processes. Far gone are the days when accountants had to manually input and categorize data since digital technologies and automation have been transforming the way things used to be operated, faster and with fewer errors. But that doesn’t mean there is no room for boosting productivity. In order to take full advantage of the existing tools, the key lies in developing the skills and knowledge of their users – financial staff. It will be such a waste if they aren’t aware of all the functions of the softwares they are using or don’t keep up with the updated features that can help them work more productively. As the saying goes, “Knowledge is power”, learning to become an expert in your field and you won’t have to worry about being replaced by new technologies!

4. Embrace change 

Enhanced productivity is the result of changes, not only in terms of implemented methods but also about adopting a forward-thinking attitude that welcomes innovations. As financial professionals, are you curious enough to question how things work the way they do? Are you willing to risk breaking down the routine to adopt a new approach which may increase efficiency but is likely to cause disruptions to the current system? If the answers to these above questions are ‘yes’, then you are having the right mindset to initiate changes and take on the challenges that follow. The reward for those who are ready to embrace changes is definitely worth all the effort. And remember that you are not alone in this transformative process. For example, receipt scanning and expense tracking services offered by Shoeboxed can relieve your burden of keeping and sorting out tons of paper bills, saving a great deal of time when there is a need to retrieve and organize data. Shoeboxed has different plans to cater for enterprises of all sizes, so this is perfect for start-up creative businesses which are often run by a small number of people with little accounting experience.

5. Experiment

How can you know which part of the financial system and processes need to improve its productivity? What might be the productivity techniques that are suitable for your business? Just following the trend and applying new tools randomly before thoroughly examining their potential effects and preparing for necessary interventions may lead to counterproductive results. But even the most cautious minds can’t foresee all scenarios, and despite that, we shall continue to learn from failures, test and retest available productivity solutions. In this long-run experiment, it is advisable that every detail in the workflow be kept record of so that important information is not going to be lost in the transition. Moreover, by doing so, it will be easier to identify the gaps in the system where efficiency can be further improved to optimize workflows, raising overall business performance. With Shoeboxed, you can experience all our amazing features such as digitizing data from receipts and business cards, or creating customized expense reports for free in one month before making your choice. See more on our website https://www.shoeboxed.com/

Conclusion

Creative businesses and other enterprises alike can enjoy tremendous benefits from productivity management that facilitates strategy execution and cost – profit management. Financial professionals, thus, should also play an active role in making financial functions and processes more time and cost effective. Productive financial management practices can start with 5 basic tips which have been discussed above: Use time wisely, Teamwork, Optimize tools, Embrace changes, and Experiment. 

Has any point mentioned in these tips been on your mind lately? Which tips are you interested in or have applied in your business? Share with us your thoughts and stories in the comment ??

Smart Business Uses Expense Tracking Apps For Better Budgeting

If you’re looking for a way to manage your business expenses, you should consider using an expense tracking app. Expense management can be tedious and time-consuming without the right tools. With so many apps available in the market today, it’s easy to use one that suits your needs! In this blog post, we will discuss why businesses should look into expense tracking and how they can get started with an expense tracking app of their own.

Expense tracking apps can save you money on taxes

Whether it’s tracking receipts, mileage, or purchases, Shoeboxed offers the best options to ensure that everything is accounted for to save and maximize tax deductions. In addition, this expense tracking app goes into great detail about how much money has been spent per category so businesses can better budget their funds.

Tracking expenses with an app is much easier than using a paper journal

For small businesses, tracking expenses with a paper journal is tedious, time-consuming, and can lead to errors. Expense tracking apps have improved over the years by offering robust capabilities that make it easy for businesses to keep tabs on how much they’re spending and where their money goes!

With an expense tracker app like Shoeboxed, you’ll never miss another receipt or misplace your mileage log again!

Tracking expenses with Shoeboxed is more intuitive than tracking on spreadsheets

With Shoeboxed, you won’t have to worry about formulas or remembering which cell is for what because it’s all set up in one place!

Excel lacks the ease of use and intuitiveness of an app like Shoeboxed. With this app, it’s easy to categorize your expenses into sub-categories (e.g., food, hotel) to better organize the data and see where all funds are being spent.

The best expense tracking apps will help you keep track of your spending and make it easy to categorize the different types of expenses 

Your receipts are about to get a whole lot easier on the eyes. As soon as your receipt has been scanned, Shoeboxed categorizes the information by business, the amount spent, date, etc., so that you can see all of this information at one glance – no more scrolling left-to-right through an endless spreadsheet! The data is searchable and editable whenever users need to make changes or add additional details after scanning their documents in real-time.

Tracking mileage

For frequent travelers, it’s hard to keep track of your work-related travel trips and making sure you’re receiving the correct reimbursement for your time. With their GPS-enabled features, Shoeboxed makes it easier than ever before to manage expenses through reporting on mileage driven, so no more guessing how many miles were logged while out running jobs and errands; It’s always accurate!

Expense tracking apps allow you to export data for tax purposes easily or send reports straight to your accountant if needed 

Exporting and importing data is simple with Shoeboxed. The expense tracking app allows you to export your expenses in various formats, including .pdf and .csv files, which can be used for tax purposes or sent directly to your accountant! This will significantly improve your mood and reduce stress during tax season every year.

For larger companies, like tech or software creators, their SaaS accounting teams will be able to easily sort through company/employee expenses.

You can send in images of receipts

Digitally archived receipts are safe from being lost in the depths of your shoebox. The IRS and CRA will accept digital images, so you don’t have to worry about losing any crucial documents during an audit!

Shoeboxed is an expense tracking app that makes it easy for you to create expense reports directly from your phone, export them right into the system of whoever needs those records quickly and efficiently without ever needing to type anything in or scan anything out. Now, with just the simple task of taking images of your receipts with your Phone camera than filling in forms by hand at home or even logging onto a computer within office hours for programs like Quickbooks — no longer do you have to wait days before getting any actionable data back about what’s happening inside your company where every dollar counts!

Shoeboxed lets workers work smarter rather than harder to spend less time inputting tedious information and more time helping to build your business.

Shoeboxed will sort through your receipts

Receipt management can take days to go through and organize everything properly. Suppose you haven’t calculated your expenses but kept all your receipts. In that case, as an expense tracking app, Shoeboxed can analyze your data and let you know how much money is left in each category to better budget accordingly.

All you have to do is gather all of your receipts in an envelope and send it over to Shoeboxed. The team will then manually sort through your receipts and convert your information into online data.

Conclusion

The best expense tracking app for small businesses will keep track of receipts, mileage logs, purchase history, and other categories like food/drinks or hotel stay to provide users with a complete picture of their expenses. With Shoeboxed’s intuitive interface and features like exporting reports directly to an accountant, it’s easy to see why this expense tracking app should be on the list of considerations when looking at ways to streamline business processes!

At Shoeboxed, you can create an account and get started on the 30-day trial right away with your chosen plan. You’ll have 30 days to use the features of this subscription before deciding if it’s for you – no need to worry about getting locked in or wasting any time on a product that doesn’t serve your needs.