Starting a family is one of the most wonderful, life affirming things you will ever do. You’ll start to see the beauty in the small things like a child’s giggle or a smile. There’s nothing more rewarding than watching a child grow into an adult. There’s nothing more warming than a close, happy family. Of course, one thing looms large over all of this, and that’s money. Starting a family is a wonderful thing, but it’s also an expensive thing!
Today we’re going to look at how to set your family up for the financial future. It starts with simple ideas about budgeting and costs. Your everyday costs will increase and as a family, you need to be prepared for that. Then there’s the prospect of college tuition looming ominously on the horizon! It pays to start thinking about these things early. Without further ado, here are our four key tips for new families.
Budget, budget, budget - If you thought you worked to a tight budget before, think again! You can expect a child to cost you roughly $200,000 before the age of eighteen. That’s before you even think of college fees. Take the time to make a full plan of expenses. Consider everything from diapers to baby proofing the house to shopping. One great tip here is to adjust to a new budget as soon as you are pregnant. When the baby comes, you’ll be comfortable in the new budget.
Life insurance and wills. - Once you’re married, it’s important to start securing your financial future. Speak to a life insurance company and take a fresh look at your will. If the worst happens, you need to know that your family is financially secure in your absence. This is a difficult subject for families to discuss. However, the earlier it is secured, the better your premium. Not only that, but your family will have peace of mind for the future.
Emergency fund - Everyone should keep an emergency pot of money aside. This should cover the likes of sudden employment or maintenance for the house or car. If anything goes wrong, it pays to be prepared financially. This is even more important when there is an entire family to consider. Since your budget and expenses are set to increase, so should your emergency. Try to divert more funds to this bank account to cover any potential problems.
College fund - This will make any parent’s bank balance shudder and shrivell! The costs of sending your children to college can reach into the tens of thousands. It’s never too early to start preparing for this and it’s worth putting away a little bit each month. You could be more creative with this and secure this money through bonds or investments. Your money may go further here and you’ll be more likely to cover the astronomical expenses.
If you have little ones on the way or you’re planning a family, plan your finances too. Prepare for any emergencies and start saving early. You’ll thank yourself later!
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