Balancing your family budget Shell page

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  Young parents sit with their toddler daughter as she playfully taps on a calculator.

The way some people think they spend money and the way they actually spend it can be worlds apart. That's why we think it's important to have a clear (and realistic) understanding of exactly where your money goes each month.

Even though the term "budget" may bring to mind images of clipping coupons or eating ramen noodles, it doesn't have to be a painful experience. Budgeting can simply help you get a handle on how you spend your money each month. And finding that little "extra" can mean a lot as you move toward reaching your long-term financial goals, like retirement.

Some items to consider:

It may be hard to figure out where to start, so below are some categories to make sure you include in your budget.

Your income

  • Wages
  • Dividends and interest from investments
  • Pensions, including Old Age Security (OAS) and Canada Pension Plan (CPP)
  • Other sources of income

Your living expenses

  • Mortgage or rent payment
  • Utilities
  • Groceries
  • Transportation costs
  • Child care
  • Insurance premiums
  • Home repairs

Don't forget to factor in the money you use to have fun - dining out, travel and gifts for family and friends.

Debts you may owe

  • Mortgages
  • Credit cards
  • Car payments
  • Student loans
  • Home equity or other personal loans

Taxes and other financial commitments

  • Income tax and property taxes
  • Recurring contributions to retirement plans or education savings plans

The dangers of too much debt

Just like a good credit score can help you qualify for a job and better loan rates, a poor credit score and excessive borrowing can have negative effects on your financial life. That's why it's important to set goals and limits and keep careful track of your monthly spending.

You're not alone

At Edward Jones, we believe making a plan and sticking to it is an important step on your road toward meeting your financial goals. Your local Edward Jones financial advisor can work with you to review your current situation, refine your goals and create a strategy to keep you on track.