Parents want the best for their children, but offering them a future of opportunities comes at a price. Tuition, marriage, cars, homes, and more aren’t easy for most adults to save up for when it comes to themselves. If you want to help your child with any of these, then you’ll need to create a family financial plan now before it’s too late. Here’s what to do.
No plan comes to fruition without a goal in mind. If you want to pay for your daughter’s wedding, then that’s your goal. Maybe it’s helping with college tuition, adding to the down payment on a house, or buying their first car.
Whatever goal you want to achieve, write it down. Be realistic when setting these goals. Chances are, you won’t be able to pay for the entire cost of a house or college tuition. Instead, set a monetary goal for the amount you want to help contribute.
It might help to speak with your family law attorneys during this time. They can draft legal documents surrounding where this money goes in a worst case scenario, ensuring your child has the funds you set aside for them.
The Path There
Imagine you want to help pay for part of a house to the tune of $10,000. That’s a large sum of cash, but think about the amount of time before your child will reach that age. The younger they are, the longer you have to save.
If you had 19 years and ten months to save the money, then you would only need to save $35 a month. Not so bad, right? You can use a savings calculator to find out how much you need to put away monthly based on your goals.
Track Your Spending
To ensure you can meet those monthly goals, you need to track your spending. Take one month and write down every instance where you spend money. That includes gasoline, food, bills, and everything else. You should also keep track of any money coming in.
From there, you need to identify which areas of spending are essential and which are not. You might be surprised to learn where you can cut back your spending and help you save even more.
Still short on your goal? If so, the next step is to lower any of your outstanding debts. Are there any bills you can pay off to increase your monthly budget? If not, which ones can you get close? The sooner you can pay off debts, the sooner you can save the sum of that monthly bill instead.
Your income and other factors may change over time, like experiencing a divorce but you receive financial assistance from your ex in the form of spousal support or alimony. Injuries at work and other accidents that are not your fault can help create a payday too. Plenty of people receive large sums of compensation with the help of a bilingual personal injury attorney when an injury occurs at the negligence of another. You never know what might help you reach your goal along the way.