If you have kids, you probably find yourself constantly worried about your financial situation. If you’re a parent, you’ll know that your kids are completely dependant on you and will be for quite some time. You might think that this period ends after they turn 18, but actually, it might not. A staggering number of kids are now moving back in with their parents after they finish college and even if they don’t, you might find that they also ask for your help buying a home, putting your money towards a loan. The reason for this is that young couples or individuals don’t typically have a lot of money for a mortgage. But they do want to get on the property market and make sure they get a mortgage deal that won’t become unmanageable. The best way to do this is to make sure that they have a sizeable deposit to put down and this may require your help.
Of course, you’ll only be able to offer this type of support if you are in a strong financial situation. That’s what we need to think about today. You see, we’re going to discuss how to make sure that your kids are going to be financially secure in the future but it’s impossible to do that without addressing your finances as well.
The first step that you need to think about is a college fund.
Save Early, And You’ll Be Less Stressed Later
You don’t have to do this, but it’s a smart way of making sure that your kid isn’t stuck under an unfathomable weight of debt once they leave college. It’s common these days for people to start a college fund before they even have children. If you know you want kids, you should start saving as early as you can, even if the saving fund isn’t exacted labeled a ‘future college fund for my unborn child.’
If you do not save like this, then make sure that you are using a high-interest account. We’re going to talk more about these a little later, but you should make sure that you are looking for a good offer. Not all savings accounts are equal with some locking you in for a crazily long length of time. If you remove the money early, you can also lose the interest that you have already accumulated. Now, this can be a positive as it more of less ensures that you are not left in a position where you immediately reach for the money you saved whenever you want to buy something. But, it can also put you in a difficult situation if the economy takes a turn for the worst.
Make Sure You Invest
You should be looking to build up savings into investments as well. One of the ways that you can do this is with property. You can consider investing any money that you have saved into buying homes to either sell or rent out. Typically, you’ll start with one home and then build from there. A lot of people think that you need an insane amount of money to buy a second home for investment purposes. But actually, you don’t. You just need to make enough for the deposit which for a small house can be just a couple of thousand. After a few years saving, you might have that ready to go.
If you’re thinking that a home comes with various bills that you need to deal with on top of the original cost, then you are absolutely right. However, you’ll find these are easy to manage because you can use the money you get from either rent or sales flipping the home to pay off the cost. The best news about this type of investment is that it doesn’t require that much expertise either. If you have ever bought and sold a home, you probably know what you need to do to make it look presentable. Even if you haven’t, you really just need to focus on what you’d like. In other words, a clean, stylish, modern property that looks easy to manage.
Of course, this isn’t the only investment that you can consider. There are lots of different possibilities. For instance, you could invest in penny stocks. Penny stocks can be a great low-risk way to get involved in the stock market where you won’t have to worry about potentially losing a lot of money due to bad decisions. Do make sure that you explore what the best penny stocks are on the market before you start investing.
Need A Little Extra?
You may find that you are struggling to save enough money to invest any at all. If that’s the case, then you should probably think about looking for a side hustle. Blogging can be a great side hustle and while it will take you a brief period of time to get the audience and the demand that you need to make money. The best way to get a jump start is to make sure that you are active on various forms of social media including things like Twitter and Facebook. That way, you can push followers from these places towards your blog and get the reads you need, eventually monetizing.
If you want another possible side hustle to consider, you may wish to think about using a skill that you possess to make money. An example of this could be cooking. If you’re great at cooking or love baking, you can do this in your spare time, sell the products and make money from something you love.
These are just some of the ways that you can make money and ensure that you have the finances you need to help your child out in the future. But what about dealing with unexpected scenarios that could impact your finances.
Coping With Redundancy?
If you are made redundant, you will struggle to keep your kids financially stable now, let alone the future. So, that could be a problem that you need to think about and consider carefully. The best way to protect yourself from a redundancy is to make sure, as we’ve already suggested, that you do have a second income set up. As well as this, you should always be on the job market, even when you’re comfortable in your current position. It’s easy to assume that if you complete good work and always work hard, you’re going to have a job, but that’s not true. Companies and businesses fail for a variety of reasons, plunging you into unemployment.
By keeping a check on the job market, you will, at the very least, be in a position where the wait to find a new job isn’t going to be that long. As such, you will be able to stabilize your finances.
What About The Inability To Work?
That’s more difficult, and it is something that you should consider even during the point where you choose your career. Do you really want to choose a career that depends on you remaining active? This can be risky because you won’t be in the same level of physical health for your entire life, hardly anyone is. It’s also worth making sure that you are looking after your health as much as you can because certain people, according to insurance companies, are more likely to develop a disability that puts them out of work and that includes people who are obese. Now, the good news is that using the services of an insurance agency, you can make sure that you are entitled to benefits if a disability impacts your career path. This type of insurance is worth considering as it offers you a solid form of protection that you can count on.
Handling Your Kid’s Money
You might think that kids don’t have a lot of money to handle and a piggy bank will suffice. This might be true when they are younger but as they get older kids can grow their finances. Some might get part-time jobs, and others could inherit cash. It’s tempting to let them use this money as they like and learn the value of it but really, you should be helping them save. That way, you can use any money they accumulate to make sure that they can one day help themselves rather than turning to you. While letting them waste it might be a valuable lesson in the short term it is also exactly that, a waste.
You may also want to think about making sure that your kids get experience working as early as possible. Obviously, we’re not suggesting you point them in the direction of the office at ten. But by the time they reach their mid-teens, they should be looking towards a part-time job. This will give them a strong advantage on the job market later, ensuring that they are not the greenest one applying for a particular position.
We hope you find this advice beneficial when thinking about the finances of your kids.