Welcoming your new born child into the world evokes powerful emotions. In spite of the long hours spent shuttling between hospital wards and home, and tending to your child’s every need, it’s often a time filled with joy and elation.
It may be an ecstatic time, but (like most things in life) the feeling soon wears off. You’re a parent now, and that comes with a lot of responsibility. With the cost of raising a child to the age of 21 now slated to be in the region of £230, 000, securing the financial future of your loved ones should be more of a priority than ever.
However, there are a few things you can do to reduce the financial stress that comes with being a parent.
Purchase life insurance
Although recognised as an imperative financial safeguard, recent figures show that only 45% of male and 38% of female breadwinners have actually taken out a policy.
In the event of your untimely death, life insurance provides a lump sum cash pay-out to your family to aid them through a time of detrimental change. Whether it’s to secure mortgage payments, ensure financial comfort or to leave something behind for loved ones, life insurance may be the smartest move for your protection.
Start saving for your child’s education
We all wish to support our children with their current and future ambitions. More than ever before, more and more young adults are making their way through higher education to achieve their goals.
But what about the cost?
With the average annual tuition fees being £9188 per year in the UK, sending your children to University is no light investment. By starting a savings fund from day 1 you can ensure the security of their choices. A financial advisor will provide you with various options and help to determine what is best for you and your situation.
Get covered for a critical illness
Similar to life insurance, critical illness cover provides a lump sum payment to guarantee financial security during a difficult time. However, instead of protecting your family in the event of your passing, this cover provides a pay out after the diagnosis of a serious illness such as a heart attack, liver failure and MS.
In the event of serious illness, it is unlikely that you will be able to carry on working. You may have to take sick leave, or vacate your employment entirely, leaving you open to financial vulnerability. Critical Illness insurance is designed to afford you a peace of mind that the most important things in life will be taken care of.
Write or amend your will
This may seem like an obvious change to make after the birth of a child, but it is quite often left on the back burner. After all, deciding who should have parental responsibility for your little bundle of joy is the last thing you want to consider. However, by choosing a guardian who shares the same values and by assigning finances appropriately, you can safeguard your family’s impending future.
Plan your own retirement
With new parent costs adding up, it can be challenging to stick to your current savings plan. It’s a collective parental mistake to focus your income around your children at the expense of your own retirement plan.
By taking care of personal finances you can guarantee a comfortable retirement and as an added bonus you can show your kids how you prepare and save for the future- after all you are their biggest role model.