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Paying Off Debt as a Family: Tips and Tricks

September 21, 2018
Money Management

There is nothing more rewarding than celebrating being debt-free with the entire family. When everyone pitches in, debt can be easily managed and paid off in no time. Most financial experts recommend paying more than the minimum payment. Below are a few tips and tricks to help start your family on the debt-free path together.

Create a Family-Friendly Budget

Is your child asking for the latest action figure toy? Is your spouse making a list of home improvements? Even though you are paying off your debts, it is still possible to enjoy your budget. You just need to prioritize your spending. First, figure out your monthly income and compare that figure to your monthly expenses. Once you see the remaining amount, have a family meeting to discuss a savings plan. Then, set aside a small amount each month for each financial goal.

Make Lifestyle Adjustments

Next, review your spending habits. For example, many families order takeout or purchase convenience foods. While these seem like small charges, they add up quickly. When you review lifestyle habits, you may find areas to save money. Lowering small charges allows you to move push those extra dollars into paying off debt. For example, your family can allocate a portion of your budget each month to eating out. For the other meals, take time to plan out meals and cook together as a family. Not only is it cost-effective but it can be! CLICK HERE for some kid-approved recipes the whole family can enjoy.

Start a Virtual Family Change Jar

Most families use debit cards,  not cash. Therefore, a physical change jar may not benefit the 21st century family. However, there is an easy solution.Start a virtual family change jar. One great tool for this is Mint. This tool helps you set a budget while tracking your income and expenses. If you underspend in a month on groceries or entertainment, save it! Create a category in Mint to put your extra change. Then, at the end of the month, put it towards one of your debt payments.

Find Free Family Entertainment

Entertainment costs can add up quickly  for the average family of four or more. Here are some ideas for free entertainment:

  • Rent books and movies from your local Library
  • Participate in First Fridays in Lynchburg
  • Visit a park with a playground
  • Take up a sport as a family
  • Go on a hike together and explore the outdoors

By taking advantage of free entertainment resources around you, you can both save money and make deeper family memories.

Paying off debt can be a family goal! When everyone works together, great things can be accomplished. Share these ideas with your family and get started today! Also, check out Bank of the James eBook “10 Step Guide to Becoming Debt-Free.” You can download it for free HERE.