How can you ensure a healthier account balance at the end of the month?

What are the biggest items of expenditure for a middle-class family?

Rent or, for homeowners, mortgage and maintenance costs, taxes and health insurance premiums. These are called fixed costs.

Which costs do people underestimate?

They can include regular work-related expenses, eating out or public transport tickets. They may also include unforeseen expenses, such as dental fees, repairs or the need to buy a car urgently.

What’s the best way to keep track of your finances?

“The key thing is knowing exactly how much money comes in every month and how much goes out and on what. Budget planning is vital”, explains Jeannette Schaller, Head of Financial Planning at Migros Bank. The Migros Bank budget sheet or budget apps are really useful tools.

What’s an itemised budget?

It’s basically a list of all income and expense items. How much money comes into the account at the end of the month from salary payments? And how high are the fixed costs? What other regular costs must be covered? How much money is saved? When all the items are listed, you can see how much money is left over. The aim is to ensure that your outgoings do not exceed what’s coming in.

What’s the best way to categorise family expenses?

That depends very much on you. Every family has different financial constraints. Expert Jeannette Schaller applies the 50-30-20 principle. Here 50% of income is used on basic needs, such as rent, food, insurance and taxes, 30% goes on the personal things people need and want with the remaining 20% being use for savings. However, this model isn’t suitable for everyone.

Setting a budget and sticking to it are two very different things. What’s the key to success?

“It takes hard work. It means collecting all your receipts for a few months and noting down all your expenses meticulously”, according to the financial expert. You can then see whether you’ve overspent or are within budget over the course of this period. If you’re constantly in the red at the end of the month, then you have to look over the books. Cost items may have emerged that weren’t even on your radar. They must be budgeted for.

Where’s easiest to save a bit of cash?

You can cut costs on insurance, for instance. Do you really need all that cover? Are there less expensive alternatives to your current health insurance policy? Does the excess amount selected actually meet your needs? You can also save money on take-away coffees and eating out by bringing your own food and drinks from home. It’s also well worth reviewing any subscriptions you’ve taken out. Am I overpaying for my mobile phone, TV or broadband deal? Which streaming services or magazines have you subscribed to? Finally: are you spending too much on shopping, hobbies and going out?

How much savings does a family need?

To save, you must first have cash left over – in other words, by earning more each month than you spend. If there’s money spare at the end of the month - no matter how much - you can put it in a savings account or pay it into your pillar 3a. The second option is tax-deductible, which is advantageous. “Ideally, a family should have four to five months’ wages set aside for unforeseen events”, advises Jeannette Schaller from Migros Bank. If you have more money left over, medium- or long-term investments, such as funds, may be worth considering.

How many accounts do you need?

It’s a good idea to have several accounts, regardless of whether they are held jointly or individually. In financial expert Schaller’s view, it’s best to have the following accounts: salary or household account for everyday expenses and current payment transactions, a savings account for unforeseen expenses, a savings account for holidays, an account for taxes, an account for pillar 3a and pocket money accounts for parents. As fees for banking services can vary significantly, it’s worth comparing them. It’s also good to check whether package solutions with several accounts and cards are really the best option.

Food costs have risen. How do you deal with that?

Planning weekly meals and snacks is a great idea for families. This means you buy exactly what you need and throw no or hardly any food away. Ideally, the planned meals and food needed would be based on promotions and special offers in the supermarkets. And it’s better not to shop on an empty stomach!

Gifts and small presents can be expensive. How can you cut spending on gifts?

“Consider your price limit for gifts and stick to it”, recommends the Migros Bank expert. It may help to broach the subject with friends: is a box of chocolates, bottle of wine or bouquet of flowers absolutely necessary for every invite? Good tip: A homemade product, like a jar of jam or herbal salt, is cheaper and much more personal.

How can you enjoy family holidays despite having a limited budget?

It may help to put a certain amount towards holidays each month. The choice of destination is a key factor. Do you really have to visit a far-flung location? Is flying necessary? It’s worth looking at offers closely and checking out alternatives.

Not everyone in the family manages money in the same way. What’s the solution to that?

It’s important to discuss and agree on how much you want to spend and on what. Separate pocket money accounts and joint savings goals can help and provide motivation. The agreements have to suit everyone, otherwise problems will soon arise.

How do you explain to your child that you can’t afford everything in a way they’ll understand at their age?

The things children want present an opportunity to talk about consumption and values. Where does money come from? How important is it in our lives? What’s our approach to the things we want? “The sooner a child learns you can’t have or don’t need everything, the easier it will be for them to manage their finances responsibly later on in life”, is the view of Anja Meier from Pro Juventute. Parents can also show children what really matters in life by asking, for example, whether you really make better friends by having cool trainers.

How can you give your child pocket money on a tight budget?

Giving pocket money isn’t essential, and not all families can afford to do so. If you decide to give pocket money, the amount will depend on your child’s age and the family’s financial position. “Parents can explain to their children what their salary is used for and how the pocket money is calculated”, says the Pro Juventute expert. What’s more: “Shared experiences with parents and siblings often last longer than the excitement of newly purchased items”.

At what stage of their lives do children cost us the most?

The cost of a child depends on various factors, such as lifestyle, the parents’ financial situation and the number of siblings. According to Pro Juventute, costs rise as children grow up and peak during their teenage years. This is mainly due to higher spending on education and leisure. Having children can also result in indirect costs, i.e. reduced income because of working part-time.

What if you don’t have enough money?

If they can no longer cover the fixed costs and regular bills, life can be very challenging for families. “A divorce or twist of fate, such as an illness, can lead to painful loss of income”, indicates financial expert Jeannette Schaller. In such situations, taking out small loans is not advisable. While they might provide short-term relief, they can lead to greater financial hardship long-term as interest rates are always high.

When should you seek support?

Sooner rather than later. Budget counselling or social welfare are good starting points. “This may seem daunting at first, but it doesn’t get any easier the longer you wait,” says Jeannette Schaller. Anyone can be hit by financial hardship. You shouldn’t try to hide your problems, but instead seek support.

Why are shame and money so closely linked?

“In our society, people are strongly defined by how much money they have, especially here in wealthy Switzerland,” reveals Jeannette Schaller from Migros Bank. It’s also taboo for people to fall through the cracks of the system financially. That’s exactly why we should talk about money more often and openly.