How to Optimize Your Family Budget

Each week on the podcast I’m talking to financial experts and digging in from our own experience and those in the community to share one thing you can do to move your finances closer to your goals.

This week I had the pleasure of talking with Drew Snider. He’s the Director, Financial Planning, CFP® over at Coastal Credit Union’s Wealth Management team.

You can watch the video directly below or you can get the edited transcript underneath it.

Optimize Your Family Budget This Week

Elle Martinez: What’s something families can do that can put them in a better spot with their finances? It doesn’t have to be complicated. Just something that’s going to get them moving forward.

Drew Snider: Yeah, I think if a couple sat down and had a family meeting, take an hour and in that meeting if they had their pay stubs and their latest bank statement and credit card statement in an hour, I think they could probably figure out how much money they have coming in.

And then from that, subtract what their goals are. If you want to be saving for retirement, make sure you’re saving 15 percent or 20 percent of your income to retirement.

If you’re saving for college, make sure you’re putting away at least two hundred dollars per child. Right?

We could do some calculations to figure out the exact number, but if you just want to spend an hour doing something, you could just use those numbers to quickly come up with those two goals right away.

And if, of course, if you have other goals that you’re trying to accomplish – let’s say it’s building up a cash reserve or something like that. That’s a pretty easy calculation, too.

Once you [have] those three or four goals are and subtract those out of your income, you have your pay stub right there. It’s already taken out all your taxes, your health care costs, all those premiums. And then what’s left over? You know, sit down and talk about, well, how do we want to spend the leftover money? And sometimes when you subtract the goals from your income, it’s a negative number. Right. That means you probably need to readjust your goals because it’s got to tighten the belt. Yeah. There’s nothing left for the soccer league fees and the coffee.

So you might need to either improve your income is obviously one way to do it or you may have to readjust your goals.

Maybe you’re retiring at 55, isn’t in the cards, but retiring at 60 or 62 might work for you. And then you don’t need to save as much per month for that goal.

But most people are probably going to find that they have a positive number after this, subtract out their goals that they’re dedicated. And then really it’s up to the couple who probably have differing interests and ideas about how to spend that money. But to sit down and come to an agreement as to what they’re going to spend that money on. And obviously you have to keep the house going with electricity and things like that. But you should be able to come down to what the fund money is.

That’s precisely why you have your bank statement there, because you’ll probably see where you’re spending the money on cable. You know, if you still have a landline, Netflix, Amazon Prime, Hulu, you know. Yeah, it’s all right there on your credit card and bank statements. So you’ll probably realize, like my wife and I recently did, they were still paying forty five dollars a month for a landline just to get crank calls and robo calls. So we’re canceling that soon. But I’m sure other people can find other things that they forgot that they probably have a regular subscription to a magazine or something that they don’t even read anymore or something they’re not doing anymore. So that’s that would be my tip of the week is really to have that little brief one hour meeting. If you have the paystub and your statements, you you could get a lot accomplished.

Elle: Yeah, I think that’s wonderful to really sit down and review because too often I don’t know about you, but with like two little ones, we have one eight, the other four. It’s like your day to day. You’re so busy sometimes. Sometimes those subscriptions that you’ve been paying for, it keeps going, but you’re not actually using it. So, you know, even if you, you know, take time, you know, once every month to make sure, like, are we still enjoying this? Is this something that matters to us and kind of redirecting that money? I love that, Drew. And if I took away something from this conversation, it is that personal finance, as cliche as it sounds, is really personal. The online calculators can be handy. You know, they kind of get you something to shoot for. But if you really want something tailored, you have to focus on your family’s particular needs and goals. So, guys, if you’re listening right now and you want to have a plan that’s made for you and your family, please check out coastal good bank better dot org. Drew is part of Coastal’s Wealth Management Team. They’re dedicated. I’ve talked with a lot of them. All of them are not just financially savvy, but real people that are interested in not just having you have a perfect budget, but a budget for real life, a budget where you’re enjoying life and still hitting your goals.

Thank you, Drew, for coming back on. I always enjoyed our conversation!

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