As a mother of three, with a set of twins, Gina Lincicum likes to joke that she took buy one, get one so seriously, she did it with her children. But as the founder of Moneywise Moms, she's serious about finding families the best possible deals on everything they buy. She spoke with us about balancing the family budget.
Why do families have such a hard time balancing their budgets?
Most families are busy, so it's just easier to not deal with a budget. Or they think living on a budget is restrictive, when it turns out that what's restrictive is paying out monthly payments to all your creditors. At the beginning of our marriage, we'd add up our expenses and see if we had enough money to pay them. Now we do the opposite. We look at our income and prioritize our expenses, putting a firm limit on many of the categories. This major shift of thought is what kick-started our debt payoff and eventually allowed us to pay off $87,000 in less than three years. We also realized that those big "unexpected" expenses really are expected: house repairs, car repairs and occasional medical procedures. That's just life, and not being financially prepared for them was foolish. Now we have a "Murphy" fund, and I'm pleasantly surprised when we go a year without a major appliance breaking (knock on wood).
When looking at a coupon or deal, what will make you opt to take it, or not bother with it?
I probably don't bother with most! We've lived on a strict budget for so long that there's no longer an impulse to just shop because of a coupon or deal. It's too easy to impulse buy and go over budget, for example, when you're receiving store emails that say "hurry!" I think it's important to seek out your own deals with mindful spending that follows your priorities and budget. We take time to research prices on purchases, and I know what things cost (and what my limits are) for monthly expenses like groceries, clothing and family entertainment.
What are some ways families don't realize they could save money?
A lot of families (including mine) have expenses on auto-pilot, such as a gym membership not being used, car insurance on auto-renewal and others. It's worth taking the time once a year to call your insurance company, satellite company, etc., and ask if there are any discounts to be applied. You can also see if you can get a better rate elsewhere, then ask for it to be matched (if you'd prefer not to make the switch). Monthly memberships and programs are usually paid automatically on a credit card; are you really getting value for it? It may be time to cancel.
What advice do you have for couples that find it hard to talk about money?
Start with small and short discussions, since every little step forward is progress. It took us many years to finally start paying off our debt, after many of these small discussions to help us get on the same page and realize we had the same goals. Finding a neutral location can set the tone for working together. The first few years that we sat down to talk through our yearly financial goals, it was over milkshakes (that made it more palatable). Then make it a regular thing; we talk about "big stuff" once a quarter, but we check in on the daily/monthly budget at least once a week.
How do you explain finance to the kids, especially when it means cutting back?
We talk a lot about wants vs. needs, and we also talk out loud about our own finances so the kids are learning over the years. Each child is expected to divide their weekly allowance into saving both long- and short-term, giving, and spending. We discuss how this parallels our adult paychecks going towards retirement, giving and our expenses both big and small. In regards to cutting back, we had many "Family Meetings" during our debt-payoff years, and the kids knew that we weren't taking vacations, eating out or impulse spending because we had a larger goal in mind. Now that we have a little discretionary income, they are part of the discussion: Does it go towards a trip? Extra-curricular activities? Another goal?
How is personal finance going to change for our kids?
I think that my generation was raised to believe that one should go to college, get a good job and stay there. But with college grads not necessarily finding work, student loan debt at its height and job security questionable in these times, that may not be the path for our kids. I feel strongly that kids should be learning how to use their skills to create income on their own terms at an early age - in their teens - learning self-employment through babysitting, mowing lawns, shoveling snow and other neighborhood jobs. They can even learn basic marketing skills like advertising and competition. It's these "side hustle"-type jobs that adults are now using to pay off debt at a more rapid pace, bridge the gap between employments and even work from home for a more flexible family life. Parents can keep an open mind about non-traditional paths to jobs and wealth, and introduce their kids to adults who are successful.