What is the two word phrase that is most synonymous with ‘family happiness’?  It is … ‘family finances.’  Notice I did not say ‘family wealth’ – happiness in a home, marriage, and family is most often directly correlated with the ability of the parents to properly manage (not accumulate) and budget their finances! It is unfortunately true that over 80% of all divorces result, in some way or another, over finances. More tragic than the divorce is the fact that families are torn apart, children suffer, and society is feeling the negative ramifications of this all too common reality.

Fortunately, with a little education, self-discipline, and effort, we truly can ensure that our ‘family finances’ result in ‘family happiness.’ May I suggest 10 ways on how to accomplish this:

1) Establish a budget and live within your means: First, do you even have a budget?  If so, do you actually live by it? Do you actually record every expenditure, so that at the end of the month (when you sit down and go over finances together … right) you know where every penny has gone!  At the end of the month as you look over the finances, did you purchase something you did not need? Stick to the budget and live within your means!

2) Never accumulate consumer debt: Do you know the difference between Good Debt vs. Consumer Debt? Good debt is when you have to borrow money for some type of an investment: a house, your education, or to start a business, etc. Consumer debt is simply purchasing anything on credit outside of these three areas. If you don’t have the money to buy it – don’t buy it! 

3) Credit cards are NOT bad: Now, above on point 2 I mentioned to never purchase anything on credit you don’t need or have money for. That does not mean you can’t purchase your groceries on a credit card (in fact, I encourage you to do that). Using credit cards, properly, is essential to your financial success. What is the proper way to use a credit card? It is simple: never use more than 25% of the credit limit, make your payments on time, and pay off the entire balance at the end of the month. 

4) Understand the importance of building and protecting your credit: In my opinion, protecting your credit is just as important as protecting your social security number. Your financial future and success hinges upon that report/score. Do you want lower rates, better jobs, larger loans, better pay, etc.? Than you better protect your credit. I tell people all the time that investing in Identity Theft Protection is just as important as any Life Insurance program in our day and age. Now, do you know how to build and improve you score/report?  It really is simple: never use more than 25% of the credit limit, make your payments on time, and pay off the entire balance at the end of the month (sound familiar)!

5) ‘Wealth’ is not the accumulation of money, it is the proper management of it: Our culture and society certainly has a skewed perception of what true wealth is. If, for example, an individual makes 1 million dollars a year, we assume they are wealthy. Well, if that person spent 1.2 million dollars that same year, that certainly is not wealth, is it? In fact, the promotions and pay raises we all seek in our jobs will do little if we increase our spending as our income increases. Robert Kiyosaki refers to this idiocracy as the ‘rat race.’ We need to learn how to properly budget, manage, save, and invest our money – not just spend it. Thus, true ‘Wealth’ is getting out of this ‘rat race,’ it is financial independence, it is passive income, and it is time freedom! Learn now how to manage your money before it manages you!  Both men and women would do well to change their perception from ‘how much can my spouse make’ to ‘how well do they manage their finances.’

6) Self-Discipline and Self-Restraint are essential: Self-discipline in regards to money is far more important than any advanced course in accounting or financial management. Parents would do well to develop this ability, and they would be wise to teach this to their children! However, please don’t mis-understand – ‘self-discipline’ does not translate into self-denial or impoverishment. There is nothing wrong with buying ‘things’ that are fun, entertaining, or the kids would enjoy. Where the line must be drawn is in the questions ‘can we afford this’ or ‘is this in our budget’ or ‘do we actually need this’ etc. And, ironically, self-discipline in financial matters will translate into self-discipline in other areas and aspects of life.

7) Save: That’s it – just save! Learn now to discipline yourselves and budget 10% of all earnings. Save for a rainy day, for retirement, for kid’s college funds, vacations, investments, etc. Avoid consumer debt, prepare for disasters or unemployment, and save 10% of all earnings – ALWAYS!

8) The importance of Insurance: Do you have proper and adequate home insurance, life insurance, health insurance, and car insurance? If not, you are potentially setting yourself up for financial disaster. And, in our day and age, do you have Identity Theft Protection? It is just as, if not more so, important.

9) Be balanced and enjoy life also: Sometimes I read articles of couples who save every penny (literally) so they can retire at age 40. Some are able to do this, and good for them. But, let’s be realistic and also enjoy life as well.  Perhaps it is setting aside a few hundred dollars a month, or just $20 – but take your wife on a date, treat your kids to pizza, go out to a movie, etc.  Have fun and be balanced!

10) Give and you shall receive: Ironic that this is on the list – but it is not last suggesting it’s least important. In fact, it should be number one on this list!  Learn now the great truth that when you give, you will receive. The ‘giving’ will be different for everyone. For some, it may mean giving to a charity, giving to a neighbor, to a church, to a family member, etc. But, give with no expectation or thought of reward or return, and you will receive somehow in someway – but it will happen!

Matt is the founder of http://www.awakeyourpotential.com/ – a website focused on inspiring people to achieve their goals and dreams, live up to their full potential, and learn the secrets for success in anything. As a successful entrepreneur, Matt recently accomplished one of his dreams – to write a book! His book is entitled: “Great Games! 175 Games & Activities for Families, Groups, & Children.” To view the book and learn more, visit: http://www.greatgamesbook.com/

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