Although most new-parents would be comfortable enough with a sufficiently-okay financial status, but what if you wish to strengthen your financial abilities more, as parents? And as a couple, you not just need to think about your lives as partners but also aim for better and stabilized future planning for your children in the long run. Is managing finances as parents that easy?
Definitely not. Managing finances is not an easy task for anybody. And with parents, it becomes all the more difficult to secure their present as well as future. Of all people, managing finances turnout to be quite a daunting challenge for new parents, who have just had a child, and are gripped with uneasy finances and disturbed monetary situation, to say the least.
As it goes for everybody, right from college students to entrepreneurs, even parents need to find some assistance in financial aid and management through essential finance tips. Such finance tips for parents can help them streamline their monetary and financial plans in a better way, whilst keeping in mind the financial growth that will be required to sustain a happy life in the future.
As most parents, you are bound to face some common questions like –
- Is your family in a good financial state?
- How will you take care of your children if you do not make enough money in a month?
- Is your family financially equipped enough to manage financial troubles, if any?
The following 10 basic finance tips for parents will guide you through an integrated financial management structure to help you secure your family’s life, as parents:
- Keep an eye out for your EFC
During your child’s junior year, it wouldn’t be bad to determine your EFC or Expected Family Contribution. By determining how much money is actually going into the well-being and welfare of the family will give you the right direction for your family’s financial planning. The EFC is a good way to get an idea of how much you might have to spend of your child’s tuition fees and identify the right resources to aid your child’s education – such as scholarships or education loans.
- Promote your child
Yes, that’s right. This comes down to doing a little marketing of your child as parents do not feel shy or coy about highlighting the achievements and skills of your child/children. This will only keep you in a better place when it comes to procuring any form of education loans or scholarship for your children.
- Save college funds
As parents, it is more advisable to save your child’s college funds in a custodial account. Encourage your children to save. You do not really need to save much for your child’s expenses during school or college. The best thing that you can do on your part is to collect all estimated college and tuition fees into a separate account to avoid discrepancies with your kids’ education.
- Record your financial status
As a family, it could be a little difficult to keep a track of where all your money is going and how much is actually being spent on what. But because you are involved with at least two more people in your family, you are left with no choice but to pay attention to your financial position. Determine what is your month budget, how much you spend on your daily/monthly expenses as a family, the amount of money that goes into your kid/s education, etc. Keep a record of the daily/monthly/annual spending of your family, which will eventually help you set a monetary budget and set the right financial goals to put your finances to better use.
- Make the most of government aid
For families, the government offers quite a range of financial aid that can help families manage their finances in a positive way. While most might find tapping government assistance a not-so-feasible ting to do, I say it is completely okay to do so. Do some research and find out on the type of financial welfare schemes and aid that the government in your region offers to citizens, and do not leave any stone unturned to make use of the same. Always remember that such financial aid and assistance provided to you by the government is made and tailored for you, as a citizen. And as parents, it is up to you as to how you make the best use of such financial assistance, making use of which is your basic right.
- Build up a savings cushion
An emergency fund is a dire need for anyone trying to manage their finances in a directional way. As a family, building up a savings cushion or emergency fund becomes quite a necessary action. When it comes to finances, you cannot really be sure of anything or rely on things that are not that satisfactory to keep your family safe and secure at least financially, saving up and contributing some money into your emergency funds can be a good start to stabilizing the present and future financial status.
We usually believe in ‘Ignore is bliss’; however staying ignorant in your family’s financial matters is a complete no-no. As parents, you need to take care of yourselves as well as your child/children. Do not hesitate to take any form of financial assistance from your state government or any other body that is willing to help you monetize your family’s expenses and spending in a better way. And without a doubt, you can your family can lead a life that is full of comfort and devoid of financial issues.
James Paul is a full time finance blogger and creative writer. He started his own personal finance blog in 2009 and since then has been a regular contributor for many online publications.