Financial Planning for Stress-Free Parenting
“We’re having a baby!” Now that’s news. You’re announcing the event of a lifetime. And in a matter of months you’ll be telling the world about the first smiles, words, steps, and other amazing achievements of the most beautiful baby in the world.
Now there might be a few times when you would rather be doing something else other than walking the floor and rocking a crying baby to sleep, but that’s your baby. And you’re in love and the future is sweet and you’re naturally inclined to do the right thing for your child.
This means planning and taking a sensible look at the future and understanding some financial considerations that sometimes pop up sooner than expected. So swaddle your baby and put him or her down for a few moments while we take a look at the balance sheet.
One of the first positive steps in raising your child is to take a look at savings and investment products that give you the freedom to enjoy stress-free parenting. A key person to talk to would be a credit union investment advisor.
Many financial advisers recommend holding at least $5,000 to $7,000 in a savings account or CD to cover those important expenditures that start in the first year. Or you might want to think about putting away some cash in a regular brokerage account that offers a higher return than traditional savings but can still be easily accessed.
Create stress-free parenting by ensuring your family has a solid financial foundation with life insurance to create peace of mind. Pay off the mortgage, debts, and fund college in a tax-deferred way. These life-changing events also call for putting a plan together to save for college and building an emergency fund for unforeseen events.
If you don’t have thousands to invest then you do the best you can. Decide on an amount of money to be taken out of each paycheck. If it’s $100.00 a month or even $50.00 a month and you do it every month without fail, then you’re on your way to starting a baby fund for unexpected expenses.
Child care will be one of your most significant expenses, but there are many options. Some parents will use day care facilities, stay home with the kids, swap babysitting with other parents, or drop them off at Grandma’s. In any case, count on new expenses for groceries, clothes, toys, books, fees, and school supplies, to name a few. Prior to the birth of your child it would be prudent to check out day care providers and find a place you can afford and feel comfortable with.
If you’re a working mother or father, you should be prepared to manage the reduced income caused by time off for the pregnancy and birth. Again, there are many options. Check with your employer to see if you’re covered by short-term disability insurance that covers pregnancy. A typical policy will pay 60% to 70% of your gross income for approximately six weeks following the birth of your child. If you don’t have disability insurance, find out about the Family Medical Leave Act (FMLA).
Having a new baby and raising a beautiful child is certainly more than a matter of dollars and cents, but taking the time to do some sound financial planning will give you the time to fulfill your highest expectations as a proud and loving parent.
Make your money work harder and smarter to help you reach your overall financial goals.