Everyone is trying to reduce costs in their farming operation, but some costs are easier to track than others. Vince Bailey, with Farm Credit Mid-America, says family living costs may be one item that gets overlooked, “One reason for that is because it is something you don’t put on your tax return. These costs are something you don’t normally track.”
Baily says finding a way to track and manage family living costs is not an easy thing to do. “Those can be very difficult conversations to have,” he said. “A good way to track these costs is to separate them from the rest of the operation. Just cut one check per month for family living costs and put it into a separate account. That gives your family a finite number of dollars to live from.” He added that small expenses add up over time and become problematic if they aren’t tracked appropriately. Taking the relatively simple step of cutting your family a monthly check can have a big impact on both controlling your budget and on your operation’s balance sheet.
For additional tips and financial insights, visit www.e-farmcredit.com.