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Welcome back, fellow parent

We're just about halfway through 2024! Insane right?

Mid-year is the perfect time to take a beat and review your financial plan. I know it's not the easiest ask for busy parents - no one is sacrificing their date night to talk about budgets and their financial future.

Side note. If my wife is reading this, I actually would love to do that. 🤓

Keep reading for a simple, actionable guide to help you create a mid-year budget to crush the rest of 2024.

The TL;DR

Crazy week and don't have time to read everything? All good, here are the key highlights from today's newsletter:

• Take a hard look at what you’ve spent your money on so far this year. Track every penny if you can.

• If you haven’t created a budget yet, start there. I’d recommend the 50/30/20 budget. If you have a budget, check if you’re on track and tweak as needed for the rest of the year.

• Four quick budgeting tips include getting organized, communicate with your partner or a friend at least once per month to stay on track, focus on building wealth, and get the family involved.

• Staying motivated isn’t easy. Celebrate the small wins and give yourself some grace.

Review Your Finances to Date

Before you do anything else, I’d take the time to comb through where your money has gone so far this year. Track down to the penny if you can, it’ll give you a clear financial picture.

This includes all income sources for your household, from salaries and bonus to side hustles and other revenue streams (including alimony, child support, etc.). This should hopefully be the easy part.

Next, review your expenses from the first half of this year. I typically like to break down expenses into specific categories. It helps me understand how we’re spending our money. Examples include eating out, rent/mortgage, subscriptions (Netflix, Spotify), and child care.

Create a Mid-Year Budget

Now that you’ve jotted down your year-to-date income sources and expenses, it’s time to pull it altogether into a budget.

There are all sorts of approaches to take when building a budget. My recommendation is to start with the 50/30/20 budget and then over time, tailor your budget strategy to what works best for you and your family.

The 50/30/20 budget simply breaks down your finances into three categories:

• 50% Needs: the essentials, think food and your rent/mortgage

• 30% Wants: the non-essentials, examples include subscription services and coffee runs.

• 20% Savings & Debt Management: most important for long-term financial success. Get out of debt and invest in your future (training/education, side hustles, stocks and retirement accounts).

P.S. I wrote a deep-dive on How to Make a Budget for a Family, check it out if you’re curious to learn more about the different approaches.

The final step is to jot down your financial goals for the rest of the year. How are you currently tracking to those goals?

Bonus points for thinking even further out, like 3-5 years. Having a longterm “north star” can help motivate you on the tougher days.

Something I’d recommend trying is to build goals using the SMART method. SMART stands for Specific, Measurable, Achievable, Relevant, and Time-bound.

A quick example is to save an extra $1,000 by October to spend on a trip during the holidays. Another could be to reduce credit card debt by 10% by the end of the year.

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Family-Friendly Budgeting Tips

Here’s a short list of tips that I typically share with families that I’ve helped over the last decade when it comes to budgeting:

#1: Get Organized

Once you create your budget, track your expenses regularly. If you’re like me and don’t want to share all of your financial details with an app, bust out a notepad or spreadsheet. All good with using an app? Check out YNAB (You Need a Budget), I’ve never used them but have heard really good things from other parents.

#2: Communicate Often

Regular check-ins are critical for longterm budgeting success. If you’re in a relationship, have open discussions about your budget at least once per month. If you’re riding solo or don’t trust your partner (which is a separate issue), grab a trusted friend.

Consistent communication will help you stay accountable and pivot when needed.

#3: Focus on Building Wealth

Yes, it’s important to cut out any unnecessary expenses, but that will only get you so far. Whether it’s advancing in your career, starting a side hustle, or investing in things like the stock market, actively seek ways to increase your income and wealth. That’s the best way to ultimately get out of debt and become financially free.

You can consider freelance work, selling handmade crafts, or offering tutoring services to name a few side hustles.

#4: Get the Family Involved

Budgeting should be a family affair - involve your kids if you can so that they can learn healthy financial habits from a young age. It’s as simple as taking them to the grocery store with a list and budget.

Another fun option is cooking at home and meal prepping. Kids love to work in the kitchen - have them help you prepare meals for the week. Plus, eating at home is much cheaper, healthier, and reduces food waste.

How to Stay Motivated

Think of budgeting and financial planning as a marathon, not a sprint. There will be good days and not-so-good days.

To stay motivated, take the time to acknowledge and celebrate wins, even the small ones. This has worked wonders for us especially when we were first building positive financial habits.

A final thought. Especially after becoming a parent, I realized just how unpredictable life is. Give yourself some grace and be flexible - nonsense happens. Adjust and pivot as needed.

Question of the Week 🤔

What are your financial goals for 2024?

Reply and let me know. I’d love to share with the community (it can be anonymous) so we can help each other grow this year.

Thank You for Reading

Thanks again for reading. Drop me a note with what’s on your mind, I’m here to help.

Talk soon,

The Dollar Dad

P.S. If you’re considering starting a newsletter or blog this year, I’d highly recommend Beehiiv (use my link for 20% off any paid plan for 3 months). Drop me a note if you need help getting started or growing your business.

P.S.S. As a heads up, the above link for Beehiiv is an affiliate link. If you make a purchase using the above link, I’ll receive a commission at no extra cost to you.