It’s best to have just one person in charge of the family finances. This prevents questions over what money has gone out when, and makes saving and clearing debts much easier. That one person needs to have access to all the different checking and saving accounts, as well as credit card statements, loans and the bills.But who is best in charge? Does it really matter who is in control, as long as it is just one of you? Here are X factors to think about to place the best person in charge of family finances.
The Principal Breadwinner vs. The Principal Spender
Some families will decide to place the main breadwinner in the family in charge of the finances. That person feels like he or she has earned that right because he or she is earning the most. There is nothing wrong with going down this route, but is the principal breadwinner in the house enough to handle the finances? Is that the person who spends the most money?
Usually it is the other spouse who spends the money. This is very much the case when it comes to one working spouse and one spouse at home with the kids. The one at home does the food shopping, pays the bills and makes sure the children have everything they need. It would make sense for the person who uses the money the most to be in charge.
Who’s Best With Money?
Chances are one person in the house is better with money than the other. One spouse could do all the spending without really considering the amount being spent. Whether there is enough money in the account is the last thing on his or her mind. The other spouse is more financially conscious. The shopping list is planned precisely based on the income, and clothes shopping is kept to a minimum because of the other person’s spending.
It’s best to put the person who works better with money in charge. That spouse will be able to create a reasonable budget, and keep the other spouse on track with just how much is being spent each month. Chances are if the other spouse was put in charge, that spouse would check the accounts anyway.
Who Works With the Budgeting Software Better?
Using budgeting software is quickly becoming a preference for family finances. Some software is now available for apps, which offers the ability to track on the go easily and efficiently. However, not everyone is technically minded or wants to bother with the software.
If one person is better at using technology and software better than the other, it would be worth letting that person deal with the family finances. Of course, if the other person is simply better with money, then opting for a paper-based system is an option.
Are Men or Women Better at Handling the Finances?
There is now a debate over which gender is better at handling the finances. More women are taking control of their family finances, but is that a good thing? According to the head of Lloyds TSB Family Savings, Greg Coughlan, back in 2012, women were better at handling finances and that does not seem to have changed over recent years. Young women between 20 and 40 have a better grasp on the purse strings, can make better decisions and are willing to put the effort into saving for the future.
This could be due to the fact that women are more likely to be at home with the children. They are there to check the budget and are more likely to have the spare time to log payment details and check bank statements.
Ultimately, you need to have a conversation over who will handle the family finances. Think about who has more time, and who is more likely to use the money. Chances are that one of you already does more of the budgeting than the other, and you may as well keep it that way. After all, if it isn’t broken, why fix it?