There was a time when the head of the family tightly handled the money and kept the accounts. These days budgeting seems like a boring task and no one has the time to do it. The simplest thing for Pallavi would be to ensure that all or most of her expenses are from a single bank account. If she monitors bank statements, she will start to have a better grip on her finances. It makes sense for Pallavi to be an exclusive bank account Which meets the expenses related to the house. When both partners work and spend on their personal expenses, it is difficult to achieve targeted savings for the common good and children.

If they allocate a specific amount for the house and for future goals, and keep it in a bank account, the mix of expenses and expenses will be taken care of. Pallavi can ensure that most, if not all, household bills are paid through this account. She can ensure that the debit card linked to this account is used for all family transactions. He should try and limit cash withdrawals, but always make them out of this account to make sure they are accounted for.

It will take some discipline, but soon both Pallavi and her husband will get used to this arrangement. The advantage is that for a specific month, they will be able to see how the money was spent. They will know the major heads of expenses, avoidable expenses, unexpected expenses and impulsive spending. Over time, they will see the first and foremost financial planning input for themselves – their ability to save. If this account is in surplus, it indicates that they are able to save for their future goals. Then SIPs and other investments in joint names can be remitted to this account, which will best reflect the state of the family’s finances.

Content on this page is courtesy of Center for Investment Education and Learning (CIEL).
Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.