Being a parent comes with a great deal of responsibility. Your children rely on you for safety, security, and stability. Make sure you’re ready for whatever life has in store for your family by focusing on financial planning. From budgeting for now to saving for the future, here are some simple rules for planning out your family’s finances.
You Should Start with a Budget
As a parent, you know how important planning your routine is to relieve daily stress. The same is true for your finances. When you begin to think about your financial future, you need to begin with a solid budget. Sit down and map out your income and expenses. Use an online tool or an app to pull your financial blueprints together. Even better, consider consulting a financial advisor to make sure you’re on track to reach your financial goals. A financial planner can help you with investments, savings, and estate planning, and give you some advice you know you can trust.
Savings Are Essential
If you’re a parent or preparing to become one, now is a good time to start sinking money into your savings account. Even a little bit here and there can add up to a real difference down the road. A good goal is to save up a few months of expenses, but do whatever you can while still keeping your family comfortable. Try making those morning lattes at home and put the savings into your account. Looking for more ways to save? If you have some extra time, you can look into apps that will pay you to shop, scan receipts, or answer surveys. The payouts are pretty small, but those tiny amounts can add up to real change in your savings as time goes by.
You Should Prepare for Education Expenses
Research shows that college tuition has increased nearly 300 percent over the last few decades, and that number doesn’t show any signs of slowing down. If you want your kids to go to college, start planning for that future before they say set foot in a classroom. You can set up a separate college fund and contribute to it as you can. You can also look into other financial options that may be available to you if you’re getting ready to send your kids off to college in the next couple of years. Not planning on paying for college? There are still going to be costs associated with your children’s education. From school supplies to clothing/uniforms, school can be expensive no matter the grade.
Life Insurance Can Be a Lifesaver
No one wants to think about the end of their life, but if you have children, planning for the unthinkable is a must. Life insurance will ensure that your family is taken care of in the event of your death. Before you commit to a plan, do some research so that you understand the different types of policies, as well as premiums and cash values. Cash value is helpful, as you can always settle your policy to free up cash in retirement to help pay for medical expenses or other needs. Check the fine print of your policies to see how payouts work. Keep medical records at all times since you’ll need these for your final payout.
You Need Good Health Insurance
In addition to life insurance, health insurance is another must for families. If you have coverage through your employer and are planning on having a child, make sure they can be covered under your policy. Look into the deductibles for various services and try to set funds aside to cover your side of health expenses. A health savings account can be helpful in covering costs that will come out of your pocket. Don’t have coverage through your employer and don’t qualify for Medicaid? There are still health insurance options for your children.
As a parent, you worry about your family’s safety. You can have one less worry by completing some financial planning now. So start planning, saving, and investing in your family’s future.
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