Financial planning checklist for young families

Maybe you’re in your mid-twenties, planning to get married and to start a family. But wait, there are so many things to consider, especially around budgeting. Being a parent can be very challenging, not even including sleepless nights, changing diapers, and trying to find a daycare. Now you have to worry about finances too. Sometimes it can be too much. But if you plan ahead and acknowledge the money situation before this all happens, then your family can approach in a smart way your new financial status.

There are different cost of living depending on your location but in general you have to take into account everything regarding another addition to the family. Daycare, health insurance premiums, and miscellaneous baby essentials can really burst your financial bubble. Reviewing and thinking about what those estimated costs will be in the future by drawing out a budget based on your spending tendencies can be helpful in making sure you and your spouse know what to expect. You may have to conduct your own research in relation to your personal situation in order to pen out your priorities.

Start Off Strong

Planning out years ahead can be a struggle for many families, but getting a responsible start can pay off in the long term. Having a better idea of what it is that you may need to be aware of with all the extra costs can save you and your family the trouble later on in life. You never know when a family member may get sick and who is going to have to deal with all the bills? It can a financial burden to face if it comes to that point. It can be good to expect the unexpected.

Along with planning for another person in the family, you may have to think of upgrading to a bigger home, maybe one with a backyard for the kids to play in or to host social gatherings like barbecues and pool parties. With all these new aspects coming into play potentially, you would probably like to be financially stable to be able to afford and maintain these new expenses.

Costs to Consider

According to a recent report by the Department of Agriculture, it will take a middle-class family approximately $250,000 to raise a child to age 17 which is also equal to around $13,000 annually. That is quite an amount to think about when planning for a baby and making sure you and your spouse will be able to financially provide for a comfortable lifestyle for your child.

Childcare and schooling, and paying for extracurriculars can take a huge chunk out of your income. Soccer practice and piano lessons can add up and then you have to take into consideration the increasingly expensive cost of college tuition. Basic day-to-day necessities are also part of these expenses such as food, clothing, and transportation. You may even need to get a new family car to take the kids to their activities and summer camps.

Be Prepared

We know that it can be a lot to take in when the thought of becoming a new parent pops into your head and may be overwhelming at times. But to be prepared in case of crises in terms of health emergencies or additional costs with down payments, mortgages, and taxes when starting a new family, planning ahead and budgeting can be a tremendous help. Not to even mention, a potential lifesaver in case there are medical expenses to be paid or a spouse loses income.

Tying it back to having life insurance to provide for your loved ones in unfortunate circumstances may help put your family at ease and in an independent situation. Being young and planning on expanding your family can be scary because it changes everything but obtaining the resources and doing your own research to plan out how you are going to use your money can lead to a healthy financial future. Putting aside savings habitually in case of a rainy day may be the smart choice especially when expecting another addition to the family.

Also revisiting your savings and budgeting can go a long way. No one wants to be caught off guard and have to make it up as you go. This can be very difficult and lead to enormous amounts of debt if you don’t plan ahead. Having your expenses keep building up may lead to a huge financial burden on your family.

More Family, More Expenses

As with any financial planning, expecting a new family member can hike up the expenses. Being prepared with your budgeting may bring you much-needed relief in the future. When you and your spouse have a real conversation on how you will manage the costs that come with starting a family, you may realize that there may be sacrifices that need to be made. But in the long term, really thinking it through and doing a thorough evaluation of your current financial situation leading to the future can be a practical solution before starting a family.

Life comes with its ups and downs, but something feasible that can be taken care of at this moment is creating a budgeting plan. In the end, we want your family to have a secure financial foundation and help you protect your wealth no matter what stage you are in and any circumstances. Planning financially ahead, especially when expecting to start a family can put you in a better position down the road. From daycare to health expenses to college education and everything in between including diapers, toys, car seats, and other baby equipment along with all those after-school activities, you may be looking at some sort of an adjustment to your budget to say the least. This is withholding the added food and clothing expenses too.

We Get It

Preparing for the unforeseen and not to mention retirement can be a stressful period in your life. That is why if you are proactive and take action today in investing in you and your family’s future, altogether this can put you on a path to limit a lot of headaches and financial struggles years from now. Long-term planning can go a long way and it is in your hands now on budgeting your family’s finances for a successful future. The first step is to set your goals and create a path to reach them.