Our hearty congratulations on being a new parent. Welcoming a newborn child is a blissful act and our heart goes out to those caregivers who make it day and night to make their little one feel loved and blessed. The feeling of becoming a parent is indeed inexpressible. Though you would be excited to introduce your little one to your lives, you also must be feeling the tremendous pressure to provide for your child. This journey would be in all sense new, exciting, and even scary for you. You must practice financial planning right from the stress to avoid financial stress and burdens in the later stages of your life. This article aims to provide a simple financial checklist for new parents.
- Amp up your savings and investments
Even though seems like the obvious choice, a lot of new parents fail to do this foremost step required to create your child’s future. What these new parents fail to understand is that they are bound to experience added expenditures sooner or later. And before they would realise, it would be time to send off their child to schools. So, before waiting for the stressful situation to arise and create financial burden for you, it is advised to start save for child’s future as soon as possible, possibly right from their birth. This will easen up the financial pressure on you.
- Do not forget to inevitable – healthcare plan
Thanks to the pandemic, the expenses related to healthcare are on the higher side currently. Hence, it is very important to add your child to your family healthcare plan. You can choose from the several investment options available to you. Assess the one that best serves your financial needs and demands.
- Consider beginning an SIP in a liquid mutual fund
If your savings permit, get a head start on your child’selementary educational expenses. This will dodgethe financial burden on your income in the later stages. If you do not have the lumpsum to invest in mutual funds, consider starting an Systematic Investment Plan (SIP). Since these funds would be required by you in the near future, say three to four years, consider investing your funds in liquid instruments.
- Start planning for your child’s higher education and marriage
A smart investment portfolio entails all expenses and that includes your long-term investment goals as well. Higher education fees are rising at an exponential rate. So, it makes sense to start investing for your child’s higher education and marriage as early as possible. This is because, the longer you are invested, the higher would be the magic of compounding. You do not need to invest a significant amount at the moment. You can start an SIP with a small, insignificant amount and raise your SIP investment amount as and when your income grows.
Taking care of a child means entertaining new, extra expenses; and unless you plan it fast, the expenditures are bound to plinth. Make best use of the ample time in your favour, and plan your finances better. Happy investing!