Smart Tips to Help Parents Tackle Their Finances

Smart Tips to Help Parents Tackle Their Finances

 

Keeping track of money is always important, but the pressure goes up once you start your family. If you haven’t been focusing on your finances before now, this is absolutely the time to start. Even if you’ve had an eye on your budget prior to parenthood, it’s still an ideal time to reevaluate your goals. Here’s a look at a few things parents can do to make sure their families have the financial security they need to live comfortably.

 

Consider Your Investments

 

Many young people become parents well before they figure out their investment portfolios. There are several techniques for investing, but generally speaking, the ideal portfolio has plenty of capital spread out over many different forms of investing. This means you’ll have money set aside in retirement accounts, bonds, stocks, and others.

 

Real estate is often a great investment for parents. Owning your own property means you can take control of your living space and circumstances. Moreover, often your total monthly payments between rent, taxes, and insurance still comes out as less than you’d pay in rent (however, this does depend highly on the market and how much house you’re considering).

 

Before you rush into buying a home, make sure you’ve given thought to the proper steps. Your first move should be figuring out how much house you can afford. You can use online calculators to get a general sense of what kind of payments you can expect at different price points and a guideline for your budget. Once you know what type of price point you’re looking for, reach out to your bank to get pre-approved for a mortgage. A trustworthy real estate agent can help you find a great home at your price point and make sense of the buying process.

 

Build and Stick to a Budget

 

When you’re a parent, your money has to go a long way. Children are expensive, and keeping up with their needs is a never-ending process, whether it’s diapers or field trip fees or sending them to college. That’s why it’s so important to make a budget and stick to it.

 

Too many of us are spending money without truly paying attention to where it’s really going. If you spend mindlessly, resolve to get your budget together. This will allow you to make sure you’re using your money in ways that push your family’s finances forward, not backward. Start by simply tracking your spending. Don’t try to make any big changes yet — you can’t fix what you don’t understand. Moreover, this will get you into the habit of tracking your spending so that you can stick to a budget once you’ve made it.

 

After a month or two of keeping an eye on how you spend, figure out what you can change. Most people find they’re spending more on restaurants and incidental purchases than they’d like to. The good news is: These are great categories to cut back on since they’re nice, but not necessary. Focus on cooking more at home and making use of the things you already have, and you’ll find it’s relatively easy to cut back on excess spending.

 

Find Ways to Cut ‘Necessary’ Costs

 

You may think that some aspects of your budget are unchangeable when they’re actually more malleable than you think. For example, you may see how much you spend on clothing for your children as a required expense; after all, your kids need clothing. But do you buy everything new? Second-hand shops are a great option for kids since they grow out of their clothes so quickly that very few things have time to get truly worn out. Moreover, you can sell clothes once your kids grow out of them, meaning you make something back, as well.

 

Collecting coupons, searching for sales, and keeping your eye on discount shops and resell options are great ways to keep costs low. By shopping smart, sticking to your budget, and investing wisely, you can give your family a strong financial foundation for the future.

 Author: Sara Bailey

 Photo Credit: Pexels

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