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By Jerrod Foresman
When you're raising a family, investing becomes more important than ever. You may need to prepare for future expenses such as higher education, and you may need safeguards to help protect your child’s future if something should happen to you. Such a large financial commitment will take some planning. You may want to sit down with a financial professional to establish an investment plan that will help you best meet these additional expenses.
Things you may need to consider:
Know the extent of your financial obligation: According to a U.S. Department of Agriculture study, a family making $60,600 or more each year will spend nearly $228,700 to raise a child from birth to age seventeen. Such a large financial commitment will take some planning.
Tie your investment plan to your child's age: The investment strategy should fit the age of the child. When your child is young, for example, your larger expenses are far in the future. Therefore your investment portfolio could include a more aggressive mix of stocks. As expenses such as schooling move closer, you might want to adopt a more conservative investment strategy.
Make investing for your child's education part of your budget: Starting early can generally provide a substantial advantage. If you wait until your child reaches high school to begin saving, you'll loose the advantage of time.
Reduce your expenses: Many expenses can be shaved by careful budgeting.
In Summary
If you are embarking on one of these life events, it can be an exciting yet sometimes overwhelming time. For your own financial future, “as well as your family's financial future“ it's important that you identify and rely upon qualified professionals to support you with your marital, family and financial questions.
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