By: Sara Bailey
As a parent, financial planning is in the interests of your entire family’s security. The cost of living when you have kids can quickly add up. Not only do you have the basics—like a home, utilities, and food—to account for. You also have to take care of your children’s needs in terms of clothing, toys, extracurricular activities, and education. To stay on top of your money, stringent financial planning is needed. Follow the below pointers to get started.
Look for affordable loans when buying your family home
Most Americans dream of owning a house of their very own. This is a huge investment to make and unless you have a large nest egg saved away, you will likely have to take out a loan to afford it. Take your time when scoping out options and always read the fine print of any loan offer. Usually a loan requires a down payment, a lump sum payment that you make yourself. A higher down payment will allow you to secure lower interest rates and do away with having to pay for private mortgage insurance. However, for those who can’t afford a larger down payment, it has become easier to get loans with low money down.
Download apps to your phone to stay on top of your family budget
According to Consumer.gov, a budget is a written plan that lets you take control of how you spend your money. To create one, make a list of all your sources of income for every month, from investments to salaries. Then make a list of all your expenses, from food to rent. Allot a set amount of money for each category and stick to it. A budgeting app on your phone can help ensure you don’t spend more than you should. YNAB is one popular option for “zero sum” budgeting, while Mint is recognized as being useful for aggregating all your financial data. You can even link it directly to some banking programs.
Look for deals online on food, clothes, toys, and more
When you have an entire family to account for in terms of expenses, it’s best to avoid paying full price. Whenever possible, steer clear of physical stores and look to do your shopping online—where you will find the best deals. Check out a site like RetailMeNot, which offers deals on everything from clothes and electronics to food. Sign up for email alerts in categories that are relevant to you, and you can be sure you won’t miss any coupons or cashback deals. You can even find deals online for family-friendly activities via GroupOn.
Talk to a financial advisor about investing in your family’s future
Part of smart financial planning is preparing for the future. While it’s important to save some money so that you have liquid funds to fall back on in case of emergencies—like car repairs—you should also be investing. This allows your money to grow more steadily than it would in a low-interest savings account. Index funds are a great option for new investors. They distribute your money among a variety of investments, which is the safest way to go: If one stock drops, for instance, you won’t lose all your money. If you aren’t sure where to begin, find a financial advisor in your area to help you.
With the above tips, you can feel confident in your financial planning skills. As a parent, it can be reassuring to know you have a handle on money matters and will be able to provide for yourself and your children in the future. The peace of mind this brings is well worth it.