Family Finances: What to Do When Times Get Tight by Mike Broemmel

One of the most stressful situations that can rip at the fabric of family life is a financial problem. Indeed, tight finances probably ranks after death and illness as the most challenging circumstance that a family potentially can face. Indeed, a family financial problem can lead to a frayed family unit and even physical and mental health issues within the family, according to WebMD.

The best way to address a challenging financial situation as a family is to address it head-on, to take a proactive stance in dealing with the problem. Taking this tactic necessitates an honest assessment of a family's finances and real, concrete actions to alleviate the financial problem.

Tangible Cuts Must be Made

Time and again when families face a situation when money is tight, lip service is made to making cuts in spending, but those reductions never materialize. If any type of cutting does occur, it typically is so minimal that it had a negligible if any real impact.

Every family has expenditures that can be eliminated. The cuts may seem painful at first, but allowing a more significant financial problem to develop will prove to be more traumatic in the long run.

Cable or satellite television should always be on the chopping block when a family faces financial difficulties. Depending on the level of television service, a family can save somewhere in the neighborhood of $600 to $1,200 over a six-month period without cable or satellite television.

Make a Budget for Real

Another area in which families with financial issues chat about is preparing a budget in writing. As is the case with making tangible cuts, this rarely occurs.

Having a written budget is crucial for a family in financial distress. It provides a family with accurate information about where money is being spent and where cuts can be made. A written budget is also an invaluable planning tool when it comes to the family's short- and long-term financial needs, goals and objectives.

Curtail Credit Card Usage

Oftentimes a family facing financial difficulties turn to credit cards to "buy" some breathing room. While the use of credit cards may make members of family feel a sense of relief, the fact is that taking advantage of these debt-generating instruments really only makes the financial situation worse.

A family cannot wisely utilize credit cards as a means of obtaining financial relief, even when couched in terms of providing temporary relief. Indeed, more often than not, stopping credit card use is a necessary step in stabilizing a family's unsettled financial status.

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