Becoming a parent is one of life’s greatest gifts, but it also comes with a lot more responsibility. You are no longer only responsible for yourself; instead, you are responsible for all of the needs of this new being and will continue to be responsible for at least eighteen years (for starters!). Most new parents are fixated on meeting their baby’s most immediate needs, such as feeding and diapering. However, it’s also very important for new parents to plan for the future of the entire family . . . here are some of the things that should be considered:
Not only should you contemplate today’s and this month’s immediate expenses, but you should also contemplate the future expenses of paying for a child. According to the Agriculture Department’s annual report, a child born in 2009 will cost nearly a quarter of a million dollars, or about $222,360, to raise to maturity. Furthermore, the study reported that child care accounts for 17% of the total spending while education accounts for 16% of the total. Much thought should be given to maintaining the financial welfare of your child’s care and education. You should research how to pay for these future expenses, and possibly speak to a trusted financial advisor about how to begin planning your financial future—such as considering a 529 Plan to begin saving for your child’s education. It may be easy to ignore, but you also need to consider what happens to your child’s financial future if one of life’s unforeseen circumstances occurs and you pass away prior to your child reaching maturity. Investing in some type of life insurance, at the very least, may be another investment option to shore up your child’s financial future.
As mentioned above, you need to consider what would happen to your child and his well-being if one of life’s unforeseen circumstances occurs and you pass away prior to your child reaching maturity. Who would take care of your child and how would that individual pay for your child’s future? Proper estate planning is key to making these decisions while you are able to do so, in case the unforeseen happens to you. Don’t let the legislature and courts decide who should take care of your child in your absence; take the time to make those important personal decisions now. You should indicate who you want to take care of your child if you are unable to do so, and how the guardian should use the money you leave behind to best take care of your child. Additionally, you should think about who should make financial and healthcare decisions for you if you are drastically injured (but don’t die) and need ongoing assistance of caretakers on a daily basis.
These may be decisions that you would prefer to shy away from making because they make you uncomfortable. However, you no longer have the option of leaving these decisions by the wayside because of comfort; you have a child and a family to plan and provide for, which is the greater responsibility of being a parent. Take the time to plan for the success of your new family, but also take on the additional responsibility of making difficult decisions now, just in case life’s misfortunes find you.