A financial tune-up for your growing family

Are you hearing the pitter-patter of little feet around your home? Is the backseat of your car filled with baby seats? If so, this blog post is for you! Today, you’ll get a quick but important overview of what to do (and what not to do) about taking care of finances with a growing family.

Avoid short-term mistakes

As a parent, it’s normal to want to give your children the best of everything. But those short-term desires can have some very long-term financial consequences. Adopting a mindset of getting your infant the best of everything can create a lifestyle that is hard to sustain. For example, a recent LendingTree poll found that 79% of the parents surveyed went into debt to fund their child’s extracurricular activities. This attitude spills over into education, clothing, and more, potentially creating a debt spiral. So, when spending on your child, examine all your options, including the choice to say “no” or “maybe later.”

Set a budget (and family values)

This blog talks extensively about personal budgets. And for a good reason! They can be the difference between financial freedom and living a hand-to-mouth existence. However, creating and sticking to a budget also has intangible benefits, including helping you define family values. It is a catalyst to help determine what is most important to your family and how you should approach your child’s future.

Another thing to remember is to keep one foot in the future and one foot in the present when building your budget. Think ahead by putting money into things like 529 plans for school, but don’t forget to plan for emergencies now by building up your emergency fund.

Review your insurance coverage

Speaking of the present and future, now is a great time to review all your insurance. The spike in housing prices means your home is probably worth more than you paid, but it is also more expensive to replace. So, take a moment to review your home insurance policy to ensure it will cover a total replacement of your home if needed.

Car insurance is always a good way to find extra money for your budget. It’s no secret the car insurance market is hyper-competitive; use that to your advantage to potentially save some money now.

Finally, get a life insurance checkup. If you don’t have any, determine if it would be needed by your family after you are gone. Typically, life insurance for a growing family is a good idea. Just be sure to buy enough to cover any expenses your growing family might incur and to make up for lost income. Also, ensure you are up to speed on the difference between term and whole life insurance.

Update your Will

If you don’t have a will, especially in Louisiana, it is time to get one. Louisiana law regarding wills can be complex. For a few hundred dollars, however, you can hire an attorney to create a simple will and have it filed for you. It’s a small price to ensure your estate is cared for properly.

Congrats on your growing family! By staying focused on the present and planning for the future, you can navigate your financial future and care for the ones you love the most.