Being a dad is tough work. These 10 financial tips on Father’s Day can help get some of the pressure that comes with being a super dad.
Fatherhood doesn’t come easy. And especially, if you’re working jobs, tackling finances and planning your budget, even a super dad like you could do with some help. On Father’s Day, to help you breathe easier through this phase, we’ve put together 10 tips for a super dad like you to guide you in the financial decisions that you need to take for your family.
Don’t make knee-jerk financial decisions
Before you decide on big financial commitments when your baby arrives, talk to a financial adviser first. Raising a child is a major financial commitment on its own, so you need to know how to balance this expense along with your investments and long-term financial targets. Talking to an adviser will help give you critical insights on how to plan your finances for the next few years. Lighten up with these Father’s Day jokes.
You will have to start getting realistic about any huge life goals you may have had before your baby came along. For example, it may take longer now to buy a house. It’s definitely not impossible, it just may take some more time. Proper financial, budgeting and investment guidance can help you all your goals simultaneously.
Learn to budget for your baby
Budgeting is an important financial skill you need to learn if you want to have control over your finances. Having a new baby changes your life in many ways, most of all, your finances. To make the transition into parenthood easier, you should reassess your finances and your household budget. Restructure your family budget to include all the new expenses that are coming your way. This includes costs not just for baby food products and sanitary products such as nappies but also for expenses related to insurance, healthcare, childcare, and other lifestyle changes. Redistribute your money and restructure your timeline to achieve your goals accordingly.
Get a life insurance policy
Buying a life insurance policy for yourself is one of the best ways of protecting your family and providing them with financial backing if the worst were to happen to you. It’s something you don’t want to think about, but if you have a life insurance policy with good coverage, your family will be taken care of if you’re not around anymore. Having and raising a baby is expensive, so this would be a great investment to make sooner rather than later if you haven’t done so already.
Start a savings account for your child
Opening a savings account for your child as soon as they are born or even before is a great way to start saving up for their future. Although doing this might seem a little premature, you can keep saving a little every month into this account and have enough money by the time your kid is in their 20s, to pay for their expenses. However, just make sure that you’re not sacrificing your long-term goals just to stock up this savings account.
Automate your payments and investments
As you get older, you’re more likely to have a lot more bills to pay and investment choices to make. After a point, it can get very difficult to keep track of every bill, loan repayment amount, or investment deposit that’s due every month, especially when you have a child to take care of. With your busy schedule, it is very easy to overlook or forget to make a payment on time. This can result in unnecessary penalties and can even affect your credit score. The solution – automate your payments right away. This way, you’ll never miss a single payment ever again. However, this is a good solution only for bills that don’t fluctuate much such as your loan payments, rent, utilities, etc.
Restructure your emergency fund
Ideally, your emergency fund should have anywhere between 6 to 10 months’ worth of expenses saved in it. Now that your family is growing, it’s time to adjust this fund to include expenses for your baby as well. This way, even if you lose your job or face some other financial difficulty, your family will be able to get by without much of a problem. Father’s Day is all about reimagining life as a super dad.
Set aside money for life skills and experiences
As your child grows, you want them to have the best life with all the experiences they could possibly ask for. Special moments and experiences last a lifetime and your child will cherish them all their life. These go a long way for a super dad, especially on occasions like Father’s Day.
Of course, many of these don’t cost anything at all. But look at also imparting life skills and nurturing your child’s talent through music classes, sports coaching, etc. You could also include monthly movie nights or small vacations or road trips every year. These don’t have to necessarily cost much but create a lot of value.
Get childcare at the earliest
Childcare allows you to get back to work as soon as you’re able to. However, many of the best childcare services have a long waiting list. So, it would be a good idea to start scouting nurseries near you before your baby is born. Booking your slot in advance can help you avoid waiting later. It can help you smoothly transition back to work, helping increase your family’s income.
Teach them about money young
Your child will grow up looking at you and learning how to handle money from you. In a sense, you are responsible for how well your kid manages money when they grow up. Of course, you will want the best for your kid, but that doesn’t mean you keep splurging on them. Teach them the value of money early on. Show them what it takes to save money, budget wisely, and invest for the future. Teach them the ropes of how to build a healthy relationship with money.
Update your will
Creating a will is something you’d ideally not want to think about right now. But what if something were to happen to you in the near future? Keeping this possibility in mind, it is best to safeguard the people who depend on you for finances. Create your will or update it to include your child. Also appoint a guardian to take care of them in case both you and your spouse aren’t around. Get an experienced attorney to help you draft your will and powers of attorney in the right way.