When a kid is born, the entire life of that couple goes through drastic change. Both are excited to welcome the new phase of their life. The new born baby can remarkably alter your family’s financial condition too. One may suddenly be living with an increasing expenditure, if the spouse’s income is less or not at all. With the new baby it is definite that your expense is going to increase, this includes costly baby gear and possibly childcare and many more. Today we are going to touch upon some of the basic things you should watch out for. We will focus on financial things that a couple should do when a new member has come to the family. These are the few important things which you should eventually complete being a New Parent, and if not it’s not too late to start now.
Life Insurance
Yes, you are right here you definitely need to have a life insurance but determining the right coverage isn’t as hard or as complicated as you might fear. Life insurance is not that cheap. But the right policy buys you the priceless peace of mind along with a guarantee that your family will be cared for financially even after you. This part is very important as life of family and your children’s education all depends on money directly.
For insurance your two main choices available are whole life (permanent) insurance and term insurance. Term insurance may seems to be more beneficial and most sense for a growing family, but both have their advantages. It’s always important to have a life insurance when you start your family.
Get the New Baby Added in Health Cover
Having a health cover is always important. It provides you financial support whenever you need in case of medical emergencies. If you already have a health insurance plan (either bought yourself or through employer) make sure you add the newborn to your policy. In case you don’t have the health insurance yet, you can now get it now only and make sure your baby is a part of the health policy. Some policies already cover your newborns but most of them are costly. So before going for it it’s also important to compare among all those which are available in market and then make your final decision.
Saving and Budgeting
As we all know that after the new addition in your family expenses are definitely going to increase, you have to first evaluate what your monthly budget looks like on the basis of needs and requirements. This can be done by doing a cash flow analysis. Your budget should totally depend on your take home salary. And it should not break down your monthly savings. If so try to save in different areas where you can as in by using public transport instead of daily taking a private one. These seems to be small but can surely add on to your monthly savings. With the new addition in the family you need to be more financial strong as with his or her age your liabilities will only increase, there is no chance of reduction in it.
College Savings Plan
Saving for the college fund is also an important part of your life being a parent. Education is getting expensive year by year. Exterms like medical, engineering and many other needs lots of fund. It can be difficult for you to arrange that much of fund at one time when it will be needed. So, it’s better to start saving from the beginning only. Open a separate account on the name of your child and start saving I that motherly. This will make you burden and tension free for future point of view.
Update your Nominations
You might want to have your baby as a nominee in some of your financial products. It can be your bank accounts, fixed deposits or it can be your mutual funds. This happens in case of property too. You might want to add your kid as one of the nominee in these financial assets you own so that they can have a secure future.
