Planning for the future should be part of everyone’s financial strategy. Since there are so many things for them to consider, it’s even more important for parents to look ahead when it comes to managing money. There are plenty of life events – big and small – that parents should keep in mind when putting together their budget. Here are five expenses parents should plan for when looking to the future:
It may feel morbid to think about, but the reality is one day your family will have to figure things out after you’ve passed. There are several end-of-life costs family members often wind up saddled with. From purchasing a coffin to getting catering for the wake, expenses add up to a big price tag. All things considered, funerals can wind up costing upward of $15,000. That’s a serious weight to leave on loved ones who may or may not be prepared to handle it.
Aside from funeral costs, taking out a life insurance policy protects your family members from medical bills in the event of your death, along with providing them invaluable financial benefits. The younger you are when you take the policy out, the better a deal you’re likely to get. Since rates are typically locked in for as long as 30 years, it’s a good call to get life insurance when you’re at your healthiest. Online rate calculators can give you an idea of how much you should expect to pay per month, and there are providers that allow you to buy life insurance online rather than in person.
You should also make sure your estate is in order. If you haven’t had a lawyer look over your will, do so as soon as possible. Knowing your finances will be appropriately distributed when you pass will allow you to rest easy.
We’ve all been there: The holiday season comes around, and the budget is nowhere near ready to handle those holiday-season price tags. There are few things more disheartening than realizing you can’t afford the gifts your kids want the most. If you save for holidays and other gift-giving occasions all year round, however, you’ll have the funds whenever it’s time to buy presents. This spares you from having to choose between stocking stuffers and groceries.
Time away from work is important for your entire family’s mental health. Moreover, vacations are great bonding opportunities and a chance to expand your child’s worldview. Set aside money each month to go toward some kind of trip during the year. This is a great opportunity to get your kids involved in the financial planning process. It’s tons of fun to imagine a vacation somewhere – use their interests to guide how much you need to put aside to hit your ideal travel goals.
Higher education has never been more expensive, and the odds are good the price will keep going up with time. Even if you’re not able to fund your child’s entire tuition load come college time, you might be able to make a substantial dent by opening an educational savings account. These are useful even if your child gets a full ride, or decides not to pursue a four-year degree: They can also go toward trade school, off-campus rent, and other educational pursuits.
Once you’re a parent, saving for retirement is no longer just about you. Seniors who don’t put away enough money for retirement often wind up feeling like financial burdens on their children. Setting income aside to fund your golden years will ensure that you are able to stay financially independent as you age.
If you haven’t already started saving for retirement, or if you haven’t reevaluated your retirement goals recently, take time to do so now. Consider what kinds of retirement plans are available to you, and be sure to take advantage of any employee match you might be entitled to – otherwise, you’re leaving money on the table.
Planning ahead is one of the many responsibilities of parenthood. By taking on these big events earlier rather than later, you ensure your family’s financial future.
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Article Contributed By: Emily from mightymoms.net
Site updated March 5, 2020