The first step in family finance is to build a strong foundation, which includes understanding your family’s finances, setting clear financial goals, and creating a reasonable budget.

My own experience:

My own daily financial management practice is very simple, generally a three-point method: that is, the income is divided into 3 parts, 1 share is saved for the future, 1 part is used for the present daily life, and 1 part is used for investment, entrepreneurship or loan repayment.

Here are the steps you can take to manage your finances on a day-to-day basis

The picture comes from the Internet

1. Financial self-assessment

• Know your household income: Calculate the total income of all family members, including salary, bonuses, rent, and more.
• Inventory of household assets: including cash, deposits, stocks, bonds, real estate, etc.
• Calculate household debt: including loans, credit card debt, etc.

2. Be clear about your financial goals

• Short-term goals: such as buying home appliances, going on vacation, etc.
• Medium-term goals: such as car purchases, education funds, etc.
• Long-term goals: such as retirement planning, buying a house, etc.

3. Create a budget

• Income distribution: Allocate funds to different consumption and savings goals according to the income situation.
• Necessary expenses: including rent or mortgage, food, transportation, insurance, etc.
• Non-essential expenses: such as entertainment, eating out, etc., can be adjusted appropriately according to the budget.

4. Emergency fund

• Establish an emergency fund: In order to deal with emergencies, such as unemployment, illness, etc., establishing an emergency fund is the first priority of financial management.

5. Reduce debt

• Pay off high-interest debt: Prioritize paying off debts with higher interest rates, such as credit card debt.
• Avoid new debt: Try to avoid creating new debt until you pay off your existing debt.

6. Insurance Planning

• Assess insurance needs: including life insurance, health insurance, property insurance, etc., to ensure the financial security of the family.

7. Educate yourself

• Learn about financial literacy: Improve your financial literacy by reading books, attending classes, subscribing to financial news, and more.

8. Track and Adjust

• Regular review: Regularly review the family’s financial situation and adjust the budget and financial plan according to the actual situation.

9. Investment planning

• Risk assessment: Make reasonable investment planning according to your own risk tolerance。

10.Seek professional advice

• • Consult a financial advisor: If needed, seek the help of a professional financial advisor for more professional financial advice.

epilogue

Family finance is an ongoing process that requires patience and consistent effort.

By following the steps above, you can build a strong foundation for your family’s finances and work towards your financial goals.