Budget and Savings

When your baby is born, your financial picture changes drastically. Now it's more important than ever to create, maintain and stick to a budget. You now have someone depending on you to keep the family financial matters in order. A well-thought-out budget will be your most valuable tool in managing the family money.

I came across this site and found the above lines in the first paragraph. Well, looking back when we had our first child the way we look and handle our money matters indeed changed drastically. We started creating a spreadsheet to make it easier to see and plan our budget. Making and planning a budget is the easy part. Sticking to our budget is the challenging part. As years goes by I can say we are getting wiser and smarter. At first the money we save is the amount that's left when all bills are paid and all expenses are made. Here is the formula: Savings = Total Income - Total Expenses. At end of each month we usually saved little or most of the times none. If in case, this is what you are still doing in handling your finances I suggest that you make changes as soon as possible. So after some trial and error and taking advises from books and friends the best way (for us) to save is to treat the amount we save as part of our monthly expenses and make it automatic. We opened a special type of savings account - MySavings account at POSB. In this type of savings account you choose the amount and savings date, and the savings will be made automatically each month. So when savings has been made we'll have to live within what's left - for bills, food, house rent, groceries and others.