Setting a good example for your children when it comes to managing household finances is vital. No one knows this better than Anisha and Russ Bailey. Anisha sat down with BlackEnterprise.com to tell us how she and her husband manage their household finances.
Here are some of Anisha’s tips in her own words:
One of the largest sacrifices we made was to live on one income. Initially we had plans on moving out of Ohio once we were married, but transitioning my business would require us to put those plans on hold as the cost of living was extremely important in our decision making.
Our remedy was to stay in Beavercreek, Ohio, an hour north of Cincinnati, and an hour south of Columbus. Our cost of living is relatively low, allowing us to live in a nice house, located in a nice neighborhood with great schools, a combination we were far less likely to find living in NYC, San Diego, or LA on our budget.
I also made sure to take advantage of tax opportunities. Having an entrepreneur in the home, and one who knows and studies tax law, gives our family a unique advantage, one that I share with other families through my blog at AnishaBailey.com.
As a federally licensed tax professional, an Enrolled Agent, I want to take financial savvy to the next level. I teach families and business owners how to reach their financial goals while taking advantage of our tax laws—without going completely insane in the process. So naturally, I always consider the opportunities to reduce our tax bill when we make financial decisions.
This year alone (2014 tax year), we are looking to reduce our taxes by an extra $2,500 to $3,000 simply because we considered the tax impacts of our spending. We contribute to the flexible spending account (FSA) offered through my husband’s job based on our projected medical costs for the year. I’ve hired my kids to work for me this year and we’ve done a few other things to make reducing our tax bill possible, which allows us to keep more money in our household —something many business owners and families can do.
We’ve also considered the tax opportunities available to pay for our kids’ college tuition and decided against the more common solutions for saving for our kids’ college education. I know it sounds odd, but our reasoning is simple—you want it, you pay for it whether it’s through a scholarship or by getting a job.
So instead of us paying for their education, we are establishing their work ethic, sense of appreciation and sense of responsibility through helping them take advantage of opportunities to pay their own way.
My advice to all business owners and families wanting to better manage their finances: Managing your finances doesn’t have to be a scary, confusing or overwhelming. It just takes a little thought, vision, proper guidance and action.