Having a kid is the most amazing feeling in the world. It’s also a very big responsibility. Kids have to be fed, nursed, cleaned and loved. However, it’s also a financially life changing event. Here are some things you should definitely keep in mind before the big day arrives:
- Plan for three(or more): We get it. You are amazing with your money. You save, never miss your credit card payments and always have more at the end of each month. The thing though, is that you have just been planning for one or two people. That’s going to change, and soon. So whenever you crunch your numbers the next time, make sure to factor in diapers in addition to your regulars like any EMIs or the monthly rent. Also don’t forget inflation, as things are bound to cost more with the years.
- Set goals and manage expectations: In life, there are ideals and then there are realities. Everyone wants the best and most out of life for their children. So plan ahead. Set targets. They can be monthly, quarterly or yearly. Start saving money from today so you have a big nest egg for your little birdie. It’s also good to develop a habit of saving from a young age, even if it’s a little as it becomes an ingrained habit with time which will come in handy for your retirement plans.
- Getting help: It’s more common than ever today for both parents to be working full time professional jobs. Day care and crèche is the option most convenient for parents living in big cities. Make sure you also include day care and babysitting expenses whenever you chart your future spending plans. A great way to reduce this cost are good old Grandpa and Granny (if they live close by). My grandmother used to take care of me when I was a little one and in my experience, it is the best way for a child to develop a lifelong bond of love. Also, your Mom is literally never going to say no to taking care of your child. Let the love flow (and not the cash).
- Learn how to invest: Not everyone can be a Wall Street fat cat but almost everyone can invest their saved money for guaranteed income in the long and short term. With a ton of information available online today everyone can find the best fit for themselves. When you are younger recurring deposits are generally the way to go, but it shouldn’t take you long to go for slightly better investments like SIPs or Mutual funds.
- Be Insured : I have yet to meet a parent who wants their child to be financially insecure. Everyone knows that. Changes in life are sudden and do not come with prior notice. Make sure that your child is included in your health insurance plan. Also take care that you update your will as time progresses and the family gets bigger.
Share your advices in the comments !