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Financial tips for young families in tough economy

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Posted: Monday, June 28, 2010 12:00 am

Today's young families arguably have it tougher than any generation in recent memory. With the global economy on the rebound, many young families face an uncertain future, one that depends largely on an uncertain job market and a housing market that is increasingly unpredictable.

That uncertainty makes it all the more important that today's young families gain control of their finances, a task that many families find is easier said than done. While managing finanaces can seem intimidating, that doesn't have to be the case. Young families can gain greater control of their finances with a few easy means to managing money.

  • Conduct a spending survey. One of the easiest ways for families to lose track of their finances is to take a casual approach toward spending.
  • Make saving part of the routine. Even if it's only a minimal amount, families should get into the habit of paying themselves each month. Treat a savings account like a monthly bill, depsositing a predetermined amount each month, and even more in certain months when it's affordable.
  • Don't be caught off guard. One of the things families fear most is being caught off guard by a major expense, such as an illness, problem with the house or accident. However, families, especially those with children, should always expect the unexpected and have a substantial amount of money set aside specifically for emergencies. When caught off guard, families without substantial savings set aside often must do something drastic, be it using high interest credit cards or borrowing against retirement accounts.
  • Use credit responsibly. Good credit is a major plus for young families, but a credit rating, be it bad or good, is always fluctuating. Families who consistently use credit wisely, paying bills on time and, preferably, paying full balances whenever possible, will continue to benefit from a good credit rating. However, families who have good credit today won't necessarily have good credit tomorrow. Using credit responsibly is an ongoing process, but it's one that pays big dividends, particularly for young families.



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