Starting a family can be a beautiful and life-changing experience. Like any life-changing event, it’s important to prepare yourself financially. When bringing in a new life that is dependent on yourself, it is key to set yourself up for great financial health. If you have questions, you can speak to an online tax expert from your home whether it’s in Tampa, San Francisco, or anywhere else in the US. Follow these tips to ensure that your new family will have everything you need.
Plan To Be Out Of Work
One of the first things that you should begin planning for is to be out of work for maternity or paternity leave. While many companies and states offer some sort of benefit package to use in your first few weeks of having a child, it is still crucial to plan to be without part of your income. The best way to prepare yourself for this change in income is to save money ahead of time. Creating a sinking fund or a monthly budget is a great way to start saving long before your baby arrives. Ideally, you want to make sure that you have enough money in your savings account to pay your monthly expenses for up to four months.
Create a College Fund
One thing that many young parents don’t take into consideration while their child is in their early stages of life is their college fund. Starting your child’s college fund early on in their life gives you more time to save, so they can attend the school of their dreams. Fortunately, there are many ways that you can begin saving for your child’s future education. For some the best route to go is by starting a 529 plan. This plan is designed specifically to be used for furthering education for your child.
If your child’s future college education isn’t your main focus it is still a smart idea to create a savings account for them. This way they can start their adult lives with some money. If you choose to create a savings account, make sure you do your research and find a financial institution that fits all of your needs. Since this money will be stored for a long time, it is important to find a financial solution that has no monthly service fees, this way you won’t have to worry about losing any of your money.
Know Your Deductions
While starting a family can be a very expensive endeavor, it is also important to know the ways to save once you’ve given birth. Luckily for parents, having children means you’ll be able to save more on annual taxes. There are two ways that you can claim your child on your annual taxes in order to save money. The first way is to use the
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