Starting A Family? 5 Tips You Must Consider
Starting a family isn't easy. You need to plan your life around it. Raising kids is harder than walking on the moon (No jokes). How do we make it easier?
Congratulations! You’re starting a family or at least thinking about it. As blissful as family life can be, it comes with many responsibilities. You might soon find out that diapers cost much more than you think, and school fees nowadays may amount to about the price of a Harley Davidson bike.
Considering today’s rising costs, it is doubly essential to understand the nitty-gritty of financial planning for your family. Let’s look at five fundamental steps you can take to secure your family’s finances.
1. Assess your expenses
The best way to prepare for your future is by assessing your current financial situation. The average cost of raising a child in India varies from ₹11 lakhs to over ₹50 lakhs a year. The expense of diapers alone can run up to ₹25,000 per year.
To better prepare for these kinds of expenses, you first need to take stock of your family’s current savings, income, bills, and overall expenditure to get a clear picture. Plan for the next few years based on your financial goals because the expenses related to childcare are ever-increasing. Don’t believe us? Here are some of the expenses just for the first two years:
Monthly paediatrician and physician visits
Clothes for the baby
Accessories for the baby (stroller, walker, baby chair, bedding)
Nutritious food for the nursing mother
Birthday parties and more
Get a pen and paper and list all the crucial details, such as expected income, the average cost of living per month, and monthly savings for investments. When you have a baby, the first two years can be particularly expense-heavy with medical care and celebrations costs.
This is something you want to plan for ahead of time so that you are not overwhelmed with both costs and the life changes that a baby brings.
2. Have a savings account
Unexpected expenses can throw you off your financial goals. Therefore, maintaining a savings account, investing in health plans to cover the family, and planning for emergency funds are vital. If you need to save money for future expenses, start now. The best time to learn about finances is now, and you need to make time to learn about savings and investments.
There are a plethora of resources that can help you get started on understanding finance. You can learn through knowledge banks or YouTube videos. More significant expenses, such as school and college tuition, can command a premium. If your child would like to study abroad, multiply that expense by 10.
The point we’re trying to make here is that, when starting a family, have a healthy savings account and get into the habit of putting money aside for the future.
3. Plan your investments
Financial planning and investments are vast topics. But you need to be aware of investment options and familiarise yourself with financial terms to save and earn money. Knowing where to invest your money can help you save on taxes.
The government provides plenty of provisions to save taxes, such as investments up to ₹1.5 lakhs being deductible under section 80C and much more. Read up on mutual funds, government bonds, and cryptocurrencies to educate yourself about the best ways to plan for a financially secure family life.
4. Write a will
Life is unpredictable, which is why ensuring that your family does not become destitute in case of your passing is paramount. Running a family takes work, and it requires good financial health.
To ensure the continuity of your family’s financial health, you should draw up a will and plan for your family’s expenses in your absence. Ensure that you designate beneficiaries and assign assets to your loved ones.
Just keep it simple. List all your assets, such as properties and investments, and get them on paper. Keep the language simple, and remember to appoint an executor for the will.
A simply written will is considered legal in India. However, it is a good idea to contact a lawyer and get your will attested, verified, signed and registered.
5. Ensure that you have a health plan
Healthcare is a huge part of household expenses. People get sick, and treatments require money. Expenses for treatments can get overwhelming if you have to pay out of your own pocket all at once while also caring for a sick family member.
This is why you should invest in a good health plan for your family. Secure yourself and your family by getting a health plan that covers all your health needs. Healthcare bills can strain the finances of any family, and having a health plan that benefits all your family members can ensure that you and your loved ones can live in dignity.
There are many health plan providers in the country. Why don’t you get the best that gives you benefits on all your medical bills and gives you over 50% discount on medicines? Kenko 999 Family Plan provides immense benefits from day 0 while giving you access to discounts on all your medical needs. Subscribe to this plan to care for your family the right way.