As a mother, you know the importance of saving for your kids. But you and your partner, if you have one, might not know exactly what to consider when it comes to creating the best future from a money standpoint for your child. To help you, consider these key financial tips for parents.
Saving for the future
As bittersweet as it is to see your little ones grow up, you undoubtedly want to support them in a successful future away from home. A big part of this plan is saving.
However, there are several other financial steps to take in order to set your youngsters up for a stable future.
Financial tips for parents:
Set aside money for emergencies
Take the time to build up a fund for unexpected expenses. Saving for this “emergency fund,” as it’s often known, will come in very handy if your hot water tank starts to leak or an unexpected job loss occurs in your household.
Having cash put aside solely for situations like those ones can save your whole family a lot of stress. If your emergency fund is in a bank, make sure you can withdraw from it without penalty.
Use money-saving tax tips
As a parent, you are entitled to certain tax benefits. The specific ones you qualify for will differ, obviously, depending on your country of residence.
Families can claim tax credits for children to help with the expenses that come with the new addition to your family. So, read up on the child care tax credit and related ways to save on child care.
Contribute to your own retirement
This advice probably isn’t one you expect to see in a post about financial tips for parents. But it’s important as saving for your retirement will give you peace of mind, and kids pick up on emotions of those who they look up to, like their mom!
Plus, you’ll demonstrate that it’s smart to plan financially for the future. Passing on good money habits to your kids is terrific – especially if they don’t learn this skill in school.
Employee benefits? Make use of them
If your employer provides you with discounts on medical costs as part of their team, take them up on this cost-saving opportunity! Not only will you save money, which means more savings for your kids and family as a whole, but also you’re all more likely to stay healthy if you go for regular doctor visits.
More financial tips for parents
This list only scratches the surface when it comes to money talk for parents. To help you prepare and navigate your financial life with children, Haven Life put together a guide that goes over eight critical money moves every parent should consider.
From tips on paying off high-interest debt to advice on choosing the best investment for your child’s education, no matter how you plan on saving for your child it’s important to start small and only invest what you can afford. And while it’s natural to want to give your child everything, it’s important to take care of yourself first.
On that note, self-care as a new mom isn’t selfish; in fact, it’s what’s best for everyone in your family.
I also have these tips (based on experience) which are not mentioned above, or in the Haven article:
* If you have disposable income, set up a regular monthly investment into long-term stock market funds for your child. Over the long term, the stock market is proven to outperform other investment types. Even if you save as little as £/$40-50 a month, over time, this could easily mount up to £/$20,000+ and, as you are investing every month you do not need to worry about timing the market. This will set up a fund to pay for either your child’s education, wedding, or deposit on a house.
* Teach your child(ren) about money and savings too! Please don’t just give them everything that they want, otherwise they will never appreciate things – give them a sensible amount of pocket money but teach them that if they save some of that pocket money up then they can then afford something nicer/more desirable than if they just fritter it away every month on little things. You can also use monetary incentives for them doing chores, so they only get half their pocket money upfront but if they help with the washing, tidying up, and not being naughty, then they will get more.
Having financial discipline is such an important concept for young people. I thankfully had guidance and started putting money away into a tax sheltered retirement account from the 2nd year of employment. It was nice to retire at fifty-seven knowing we were in excellent financial shape. It’s crucial to find that balance between living one’s life to the fullest, having fun, while still being responsible.
it’s really a very helpful topic for all parents. thanks for sharing Christy B