How Parents Can Plan for the Future by Focusing on Today
Parents have an idea about how you want your child’s life to play out. First, they will have all of the most adorable baby items. As they grow, they’ll play sports and graduate high school with honors. College is likely next on your list. These are wonderful dreams, but as you will soon find out, they cost money — and lots of it. Do not make the mistake of spending all of your time and money planning for tomorrow. Instead, focus on today and ways you can make the most out of your family budget so that you can fund your children’s future.
Unnecessary Expenses as parents
Before you open your college savings account, spend a few days evaluating where your money goes. You may find that you are overspending by a little bit on many different things. Your car insurance is a great example. You probably want full coverage even if you live in a state that only requires minimum protection. But if you have not reviewed what your current provider has to offer, you may be paying too much. Give your agent a quick call to find out if you qualify for discounted rates. These often include driving less than 12,000 miles each year, not having any tickets or accidents, and having theft reduction devices in place. If you are not currently working with an agent, compare rates online to make sure you are getting the most for your money (you might save hundreds each month by switching).
Cable television is another culprit that often flies under the financial radar. Unfortunately, cable providers still charge extraordinary fees for channels you can get on Amazon, Netflix, or other streaming services. Some estimates find that you can save up to half on your monthly television expenses by cutting the cable cord.
Finally, take stock of other services that you pay for that you don’t utilize. If you have a subscription for monthly makeup delivery, for example, but you aren’t using what you get, that $10 to $50 you’re spending per month may be better off sitting in the bank where it’s safe. Print out your bank statements for the last six months, grab a highlighter, and make notes of expenses that don’t benefit you during your daily life.
Understanding Big Purchases
It’s one thing to look at your current expenses, but you will also want to pay attention to how you plop down money for the big stuff, such as a home or vehicles.
When shopping for your first family home, there are steps you should take to ensure it’s a good investment. Usually, you will find that it is. Start by researching how much you can afford online and then scour the internet for homes in your price range. It’s best to stick to a lower number because there are many fees at closing that you may not have considered. Redfin suggests getting preapproved and working with a licensed real estate agent.
Next to your home, buying a vehicle for your growing family will likely be your last big expense before college. You can save thousands of dollars by purchasing a certified pre-owned (CPO) vehicle instead of something directly off the production line. While, as Edmunds points out, CPO is not a guarantee of perfection, these vehicles do come with extra protections and will likely run just as well as a new vehicle without the new vehicle price tag.
When planning for the future, pay attention to today. By cutting out excess expenses and shopping smart when it’s time to start shelling out the big bucks, you can give your kids the best quality of life possible now. And you can do it without sacrificing your ability to support them in the years before adulthood.
Image via Pixabay
This article was contributed by:
Janice Russell – Parent
Janice Russell believes the only way to survive parenthood is to find the humor in it. She created Parenting Disasters so that parents would have a go-to resource whenever they needed a laugh, but also to show parents they aren’t alone.