Here’s a surprising, but not encouraging fact: Americans, whether they are from the Midwest in Indianapolis or out west in Irvine, aren’t very good at saving. How many of us have $1,000 in the bank? Only about 30 percent. And almost half of us couldn’t even cover a $400 emergency.
This lack of saving is even more concerning when you think about the costs of raising a family. In 2013, according to the U.S. Department of Agriculture, raising a child born in 2013 to the age of 18 will cost you just over $245,000. And that cost is before you take into consideration family vacations, college funding, and other “extras.” Multiply that by two, three or four, and you’re running a million-dollar household.
Thankfully, there are steps you can take to effectively take control of your finances, and that is by using a budget. Even with this straightforward strategy, a recent study by U.S. Bank shows only 41% of Americans are using one.
No matter where you stand financially, a budget should be a priority. Having a budget will help you determine how much you’re spending. And when you line the numbers up, they won’t lie. You know where your income is going, and what things you can cut back on to free up some finances and help reprioritize your saving power.
When you do build your budget, make sure to account for every dollar you make and make sure you cover the necessities first. (After all, do you really need that grande latte?). It also helps to use some budgeting software. There are a lot of options to choose from, and you don’t necessarily need a program with all the bells and whistles to accomplish your goals.
One more thing to remember: Budgeting is an ongoing process. Your expenses will probably go up and down over time, so don’t assume that the budget you make today is going to be the exact one you follow a year from now. Keep aware of little changes in your expenses, (gas prices going up, did you account for that?) and act accordingly.
If you would like to learn more about budgeting and how it affects your wealth management strategy, we invite you to learn more at www.midwest-wealth.com or call us at 877-243-2132.
About Midwest Wealth Management, Inc.
Midwest Wealth Management, Inc. was formed by Greg Shields, a 30-year financial services veteran committed to offering sophisticated investors an alternative when looking for a more strategic path for long-term investing. As a private investment group, Midwest Wealth Management, Inc. offers a proprietary trading platform, alternative investment offerings and dedicated advisory support for a select audience. For more information, please visit www.midwest-wealth.com.