Just Had a Baby? Here’s 4 Essential Financial Considerations
The glow of fresh parenthood is quickly tainted by sleepless nights and endless feeding sessions, so it’s no surprise that getting down to the nitty-gritty details of your family's’ finances may feel like the last thing you want to do. But whether you plan for your child’s financial future pre or postpartum, it’s something that’s simply gotta be done. Here’s 4 essential considerations you need to make:
- Life and health insurance. If you haven’t already got the former, it’s time to strongly consider it. Your child is your financial dependent, and preparing for the worst case scenario - grim as it may be - is your parental responsibility. And while health insurance isn’t mandatory in the UK, if you or your partner are covered through a work scheme, you might want to add your child to your insurance plan, too.
- Start saving for their future with a Junior ISA. Help your child get a leg-start in life by starting to save early for their future. Like a regular ISA, there is a cash and a stocks and share option for the Junior version. But remember - you’re not investing for yourself and won’t be able to withdraw any of the money you put into this account. Only your child will be able to access this money when they turn 18.
- Budget your maternity (and paternity) pay. Baby-related expenses can escalate quickly, especially if you catch yourself off guard and fail to plan ahead. This is the time to say ‘yes’ to any offers of help from friends and family to buy things for your new arrival (baby shower, anyone?), especially things like clothes which babies grow out of in no time. Also, keep in mind that there’s a lot of products on the market that you can really do without, despite their aggressive marketing to try and convince you otherwise!
- Make sure your will is up to date. It may feel scary to think about, but writing/updating your will is actually likely to give you a greater peace of mind. Besides the financial elements of your will, another vital thing to consider is who will be your child’s guardian until they turn 18.
Photo by Les Anderson on Unsplash.