Starting a family surely is exciting, but it could be difficult, too. Research shows the average cost of raising a child ranges from $183,773 (£148,000) to $282,198 (£227,266). Increasingly, the decision to start a family is becoming a financial one and one out five parents are now delaying having another child for monetary reasons. This is why a smart financial preparation is advised for those who want to have kids soon. Of course, the reward of raising kids is totally worth it, whatever it costs. Still, it’s better to be prepared than to be sorry so we have listed some money saving tips that will help you save for your family’s future.
Create/Update Estate Plan
It may be unpleasant to think about, but it is encouraged for anyone who is over 18 to file a will or create an estate plan. If you have a spouse and a baby on the way or you plan on having one soon and don’t have a will, then this should be your first priority.
Eric Roberge, CFP and founder of Beyond Your Hammock says this step is one of the most important tasks that is often overlooked by aspiring parents. “If you are not around to take care of your baby, who will? This is not something that you want the court to decide,” Roberge says. You can do this easily and inexpensively through an online service like USLegalForms.com.
Make A ‘Baby Budget’ Before Arrival
The simplest way to prepare for the true cost of having a child is to start living on your “baby budget” ahead of time, using a baby costs calculator to plan. Mike Solari, CFP and founder of Solari Financial Planning, suggests estimating your change in income and starting living on a new budget before the baby arrives. Per Business Insider, you can also put the extra cash you have into a savings account.
Get Life Insurance
Similar to the will, getting life insurance is an expression of love for your family. Availing one does not cost that much compared to the peace of mind it provides. Of course, it is also important to understand what is covered and what is not, in order to get bills updated and paid on time. To be sure, you may call your health insurance provider and ask for an estimated cost of labor and delivery, because it may be significant.
Save First, Not Last
This tip is actually for everyone, but soon-to-be parents can also take advantage of this. To be able to accomplish the aforementioned three items effectively, you should always divide your money as soon as you get paid. This will ensure that you’ll have your monthly saving goals secured before you run out of money. This method will also teach or develop your budgeting or financial management skills.
Though it can be tempting to go shopping once in a while, overspending is a big NO-NO when you’re saving. To avoid this, it is suggested to organize your shopping. Have a list of the things you need to buy and take advantage of the sale dates and the coupons you have.
If possible, never buy “off the shelf”. Always do your homework first. You can try surfing the web to see where to find the item with the lowest price. Buying at thrift stores or garage sales is also an effective way to spend less.
What ways has your family found to save money? Share us some other money saving tips in the comment section below.
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