Are you about to become a parent for the first time? If so, you’ve probably already gone through the money panic that goes with the territory. Even people who have good jobs and secure futures are always a bit fearful about the days ahead. That’s because, from here on out, you are responsible for another person’s wellbeing, not just your own.
Even after the late-night feedings and first-year parent jitters are behind you, the financial responsibility will remain. Are you ready? The good news, besides the fact that you’ll be a proud parent, is that there are tried-and-true techniques for building financial stability for your family.
No matter what kind of work you do, whether you’ve managed to save a lot or nothing, and regardless of your current living situation, the following four money moves will go a long way toward setting things right.
Make A Detailed Savings Plan and Budget
The devil is in the details, as the old saying goes. But there’s another part to the wisdom of that adage: the details will save you if you do them right. When parenthood awaits, make the time to sit down and create a budget that includes every spending category you can think of. Whatever you use your money for, make a line item in the budget for it.
There are hundreds of helpful templates available at the big financial planning websites to get you started. The point is to just do it as soon as possible. Don’t feel as though every listing needs to be 100 percent accurate. It’s more about getting the core concepts and ballpark amounts down on paper. You can always tweak and adjust later on.
Get Rid of High-Interest Credit Cards
Plastic can be poison. Simply put, many credit cards come with high-interest rates that can eat into your personal budget like a termite through an old log. One of the smartest ways to banish high-rate cards is by getting a personal loan. Why? Because most loans come with higher borrowing limits and much lower interest rates. That makes it simple to pay off all those pieces of plastic and replace them with a more sensible alternative.
The good news for consumers is that it’s easier than ever to apply for personal loans online. In fact, you can get matched with various options in less than 60 seconds and then make your choice.
Start Saving for A Home
If you are not already a homeowner, which is true for most young couples, don’t fret. Saving for a first home is a time-honored endeavor that dates back more than two centuries. Don’t worry about the amount you put aside at first. The initial goal is just establishing the habit of saving and setting up a separate account at your bank for home purchase.
After a few months, you’ll get a feel for what percentage of income can be earmarked for the account. Many future moms and dads opt for five percent as a start.
And if you have a car that is useless, you can sell your junk car for extra cash and save the money.
Do An Insurance Self-Checkup
Speak with a licensed insurance agent and make sure you have enough health, life, home, car, and other types of coverage. Many couples discover that they’re lacking in at least one area, usually life insurance. Many agents will do this kind of check-up for free, so don’t hesitate to find out your insurance status before the baby arrives.