The Makings of an Updated, Smart Family Budget

The Makings of an Updated, Smart Family Budget

Welcome to 2012! Along with a new wall calendar and new date to write on your checks, a new year also ushers in a whole host of updated hopes and goals for most people.

Spend more time with family.
Get that promotion at work.
Walk the dog more often.
Avoid getting angry at your mother-in-law next time she offers more "helpful advice."
Create a new family budget.

While we can't help you with the others (although we can tell you that, yes, it might be time to develop some coping mechanisms for your mother-in-law), we can help you set up a budget for your family.

Last year we showed you how your family budget should look:


This year, take stock of whether and how well you stuck to that breakdown in 2011, and adjust your expectations accordingly. More than anything else, your end goal is for your total expenditures not to exceed 100%.

How Does Your Family Have Fun And Stay On Budget?

What are your tips and tricks to keep your family entertained while staying on budget not breaking the bank?

So, if you ended up spending 12% on healthcare last year rather than the recommended 10%, that's okay ... as long as you recoup that extra 2% from somewhere else in your budget, like transportation costs or dining in restaurants.

RELATED: How to Budget My Money ... for Splurges

How Did You Stack Up?

To assess your own spending in a snap, link your accounts to the LearnVest My Money Center and visit the Financial Inbox. From there, our program will automatically help you divide your spending into categories like Groceries, Bills and more. You can also see how much is coming in each month, so quickly figure out what percent of your income each category is taking up:

category / monthly income x 100 = % of your total budget

Now, compare those percents to the "ideal" pie chart above. The most important thing is to make sure that all of your categories add up to no more than 100% of your income. If your spending is less than 100% (and you're saving at least 10%!) then you're good to go. Write down your numbers. This is your budget target.

If you're going over 100% or not able to whittle the other sectors down enough to get your savings rate up to 10%, start thinking about where you can cut back. To help, we've come up with some ways to slim down a few of your "family spending wiggle room" categories to grease the wheels of Le Grand Budget 2012.

RELATED: Set Up a Budget and Travel Better With Friends


  • Check your rates. While you can't do much to change your nanny or daycare rates, you can try to make some changes to additional childcare charges like babysitters. Check out Sittercity to compare what you pay your current babysitter with what the going rate for sitters is in your area. If you're paying a lot more than average, consider finding someone new. If you're paying less ... good for you!
  • Make changes at work. If you've been contemplating asking your employer for more flexible hours, consider finally taking the plunge. Use our calculator to figure out how much you can afford to cut back at work, then go into the meeting with your boss with a clear-cut plan in mind. Have some ideas about how your new schedule would work, what days or hours you believe would be best for you to cut back on and how you'll still get your job done satisfactorily.
  • Use your friends. Create a playdate swap with a group of your closest mom friends so that each weekend (except for when you're hosting, of course), you can count on a "free" babysitter for a few hours. For guidance on creating a "mom coop," read this.


  • Again, hit up friends. Remember when you saw the adorable shirt your best friends' kid was wearing and thought, "Man, I want that for Lisa?' Set up a clothing swap with your friends who have kids of similar ages. Swap with four or five moms and set a guideline for the amount of clothes and/or shoes you'll bring. In the first round, let everyone choose just one item. Then go around again and again until everyone's satisfied. We recommend donating the leftovers to charity. In 20 minutes you'll have a whole new wardrobe for your child with no money spent. We did something similar in the LearnVest office--here's how we pulled it off.
  • Buy unisex clothes. There's no reason Adam and Carla can't share that green hoodie, as long as they both fit into it. If that won't work, it's still helpful to buy gender-neutral clothing now if you're considering having more kids in the future.
  • Use the web. Check out sites that allow you to give or receive clothes that no longer fit your child, or that she has simply grown tired of ("Mom! I hate pink!"). Try thredup and swapmamas to start.


  • Ditch pre-packaged. It might be easier to pick up the kid-sized version of snacks or drinks at the store, but it will save you a lot of money to buy regular or bulk-sized snacks and drinks and package them in your own re-usable containers (we like these and these).
  • Switch to store brands. The price per ounce is much less when you purchase the store brand of an item, and most of the time the ingredients are practically the same.


  • Enroll in Bootcamp. Our Cut Your Costs bootcamp will provide you with 15 days-worth of easy, cost-cutting tips and tricks that will save you tons.
  • Become a DIY pro. If you've found that your child is suddenly Polly Popularity and the money you're spending on birthday party gifts is burning a hole your wallet, try turning to DIY options (especially if you can use items you already have in the house). As an added perk, crafting with your kid will be a good excuse to spend some quality time together. Try these ideas, or these for slightly older kids.
  • Cut back on cable. Cutting out premium kid's channels and premium sports or movie channels can save $30+ a month. If your family misses the tube, we've got you covered with easy and cheap video streaming solutions.
  • Consider more online shopping. Sites that offer online shopping for drugstore items can save you a bundle. Check out our chart comparing the five big online options to see which could save you the most money.

Tell us—what are some other ways you plan to save on expenses this year?

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