Your family is continuing to grow. School, homework, soccer practice and dance recitals. Family vacations and college savings.
This is where you start to feel like a broken ATM. Dollars just spewing out of you in every direction.
Take a deep breath. Let’s get this under control. Stay the course.
Work Your Finances as a Team
By this point I’m going to hope you are happily married and already working as a team. But if you aren’t on the same page financially, stop. You’ve got to fix that first. Adding in school projects, homework, and soccer practice into the mix won’t make your money decisions any easier. Even when life is chaotic you need to take the time to talk about your finances together on a regular basis.
Here are two keys to managing your finances together as a couple:
- Couples & Money – Building a Solid Relationship with Money and Each Other
- The 11 Best Personal Finance Software to Get Your Money Swag On
Protect Your Family with Life Insurance
Listen, talking about death isn’t exactly fun. Yet having this discussion could ultimately be the best thing you ever do to provide for your growing family.
You want to have adequate life insurance, especially with a family, to protect against the loss of income from losing a spouse. Term life insurance is incredibly cheap, especially at a young age. We understand that purchasing any form of insurance, from finding the best auto insurance, to finding great health insurance can be overwhelming, we are here to help!
Here’s how you determine how much term life insurance you need to purchase to protect your family:
Prepare for the Worst and Manage Your Money
Emergencies are a fact of life. By this point you know this because with kids, there is always something breaking, being broken, or being replaced.
Boosting your emergency fund savings is of critical importance. With more mouths to feed your income is already stretched. Throwing in a $10,000 air conditioner replacement for the house won’t help.
Manage your money to allow for more cash flow at the end of the month. Then put that cash flow into your emergency fund:
- 70 Super Easy and Practical Ways to Save Money
- The 11 Best Short Term Investments For Your Money Right Now
- Emergency Fund to the Rescue
- Top 10 Best (and Free) Online Budgeting Tools
Drop the Debt
Debt when you have a growing family is like letting someone strap a 60 pound rucksack to your back and telling you to go run 5 miles in the rain.
It’s miserable. (Trust me.)
Before you add additional mouths to feed under your roof you want to drop your debt as low as possible if not completely.
Destroy your debt with these tools:
Save for Retirement So You Don’t Have to Move In With Your Kids in Your Golden Years
It’s normal to want to provide the best life for your kids. For many that means focusing on college savings soon after a child comes on the scene.
There’s one giant problem with this mindset: there are no loans or scholarships for retirement.
Your retirement must always come before setting aside dollars for college. If you can do both, great! But retirement comes first.
The longer your money is invested, the more likely your nest egg is substantial in retirement. Start now:
- Best Places to Open a Roth IRA
- Average Retirement Savings By Age – How Does Your Savings Stack Up?
- Ready to Start Investing? Here’s the Best Online Brokers for Beginners
- Video Review and Walkthrough of Personal Capital
- Personal Capital Review
Cover College Costs By Saving Early and Often
In the blink of an eye your newborn will go from poopy diapers to packing up their bags. It happens that fast!
If you have any desire to help them pay for college, then you need to start a college savings plan immediately. You can do a traditional savings account at your local bank or setup the most popular option the 529 College Savings Plan.
- Common Questions on 529 College Savings Plans
- Don’t Make This Mistake When Saving For Your Kids College
- Difference Between ESA and 529 College Savings Plans
Maintain Great Credit to Save Thousands
Your credit is your lifeline to loans for big purchases like homes and cars. It also influences your insurance rates.
A bad credit score will result in higher interest rates when you go to buy a home. The difference in a $160,000 mortgage over 30 years at 4.25% and 5.25% is $34,712. Your monthly payment will also be larger by $96.43.
Take of your credit and it will take care of you. If you don’t know your credit score, here’s how to get it:
Settle Down and Buy a Home
Want to upgrade your digs? Maybe get an extra bedroom or two so your kiddo won’t sleep in your room throughout childhood?
You’re going to need a healthy down payment to start. Grab an online savings account, and set up automatic contributions into that account to build up a separate fund specifically to buy a home with.
Then make absolutely certain you are going to stay in an era for at least 5 years before buying a home. Ideally you will live in that home for at least ten years; any less and you are looking at a significant financial hit when you pay realtors fees to sell in the future.