Budgeting For Your Child’s Future: Tips To Help You Mark Major Milestones In Style
It’s no secret that having kids is expensive. Even when your children are still tiny, you may be thinking about how you’re going to afford all the expenses that will come your way as the parent of a teen or young adult. The key to managing your finances often lies in organization. If you have kids and you dream of sending them to college or watching them get married, it’s never too early to set up a savings schedule and start putting money away. Here are some saving tips and some of the major costs you may wish to bear in mind as the parent of a growing child.
Save without scrimping
If you analyzed how you spend your money, it’s highly likely that you’d be able to identify areas where you can cut back and make savings without sacrificing a treat from time to time. Take a look at your statements and balances, have a look at your bills, and write everything down. If you don’t already make a budget every month, now is the time to start. Drawing up a budget will help you see where your money is going, and also highlight potential savings. If you’re paying a huge amount for gas for every month, for example, you may wish to rethink your commute or consider swapping your car for a more fuel-efficient vehicle. If your energy bills are too high, invest in a smart meter and make a concerted effort to use less electricity. If you’re spending a fortune on insurance, use the Internet to compare prices from different providers, and consider switching. When you’re doing your budget, work out how much disposable income you have, and set up a direct debit to your savings account. If you can put a small amount of cash away each month, this will help you build a nest-egg for your child’s future. Set an amount that you can afford, and if you have months where you’ve got a little more left over than usual, make an extra payment to your account.
Major milestones for parents
Life with young children is expensive, but when they reach their teenage years, you approach major milestones that are likely to carry significant costs.
Learning to drive and getting on the road
Perhaps the first expense you’ll stumble across as your child nears adulthood is learning to drive. The costs of taking tests like learners permit safety courses and paying for lessons is likely to add up. To lower the cost of learning to drive, be prepared to take your child out in the car to enable them to gain experience and hone their skills, and consider your options carefully when it comes to choosing their first car. If you don’t want to share your vehicle with a new driver, look into rental prices and check insurance rates before you make any decisions. The price of insurance premiums varies hugely according to the make and model of the car and the provider, but there are often ways of bringing down the cost. If you drive with a black box, for example, and keep your car in a secure garage, the fee may be lower.
Going to college
College fees in the US are among the highest in the world. The average in-state student spends $20,090 per year, and this fee rises to $34,200 for students attending colleges in a different state. If your child is taking a three or four-year course, this is a huge amount of money. The best way to tackle college fees is to start saving early. Scholarships and bursaries are available, and some courses are much cheaper than others. Online courses are also increasingly popular. If you study online, the tuition fees are much lower, you don’t have to pay for board and lodgings and students can work at the same time as studying. Talk about the different options with your child, have a look around the colleges that appeal, and work out exactly how much you’re going to be paying on an annual basis.
Most parents dream of the day their child walks down the aisle. Weddings are incredibly special events, but they don’t come cheap. The average wedding now costs in the region of $31,000. If you’re helping out with the cost of your child’s wedding, set a budget, be clear about the amount you’re willing to offer from the outset, and encourage the couple to prioritize the most important elements of the day. If there is a limited budget, for example, it’s usually possible to save money on sacrificing expenses that don’t matter too much to them, for example, a lavish wedding breakfast, a 5-tier cake and a fancy wedding car.
As a parent, you may feel like you’re constantly leaking money. Bringing up children isn’t cheap, but if you can start saving from day one, you’ll maximize your chances of celebrating those landmark occasions in style.