Written by: George Shirley All opinions are those of George Shirley and not necessarily those of RJFS or Raymond James.
Congratulations! As with any life change, the birth of a child brings a whole new series of things to deal with. New expenses, new time commitments, new friends…the list goes on and on. In the financial world, having a new person to be responsible for over the next 18 plus years can be overwhelming. Especially when the pressing issues of feeding, cleaning and caring for the baby take immediate priority, not knowing where to begin can mean doing nothing. In no particular order, here are a few tips for new parents in the financial world:
- Review your budget and spending priorities-- You have added a completely new category into the monthly expenses. This needs to come from somewhere.
- Name a guardian(s) who will raise your child if you are unable to. This can be a very difficult but necessary decision to make.
- Review your insurance-- Providing for your child and family in the event that you are unable to earn a living. Many don’t have adequate life, disability or liability insurance protection.
- Prioritize investment goals-- education, retirement, new house, emergency fund.
- Update (or draft!) a will. Dying without a will can leave important decisions up to the court.
- Review beneficiary designations for life insurance and retirement accounts.
- Adjust your expectations—things are not always going to go according to plan...especially with young children. Expect the unexpected and be prepared to adjust. Often.
- Find time for yourself (even 10-15 minutes at a time). You will need it.
The additional stress of a new baby can be compounded with significant financial stress and no clear plan. Take the time to protect your family and your new child by having these discussions, ideally before you are consumed with caring for your child. Proper planning can help you sleep better…when you actually do sleep.