Little can make you think more about the future than having a family, and it can also make you keenly aware of the need to plan. Laying a solid financial foundation is a must when others depend on you, and the last thing you want is to end up in a position where you or someone you love faces hardship. Here’s how to ensure your family is well-provided for, both in the short- and long-term.
Create crucial safety nets.
It’s natural to think about what might possibly happen if you or your partner should unexpectedly pass. Creating an actual safety net ensures if those unfortunate circumstances arise, your family is properly provided for. With that in mind, consider doing some estate planning. Decide who you prefer to step in as legal guardian, preplan your funeral, and examine your life insurance options.
One important insurance to consider is disability insurance. As Money Under 30 explains, disability insurance helps replace your income if you should become unable to work, and there are both short- and long-term options. A wide variety of circumstances are typically covered, such as an injury, pregnancy, or illness. A standard policy replaces 60 percent of your income. Short-term policies are typically for three to six months, while long-term policies could potentially cover through retirement age.
There is also legal documentation you should assemble for your family’s security, such as a will, trust, power of attorney, and healthcare proxy. By establishing these things while you are fully able, you ensure your desires are met, and loved ones are taken care of, come what may.
Focus on your future.
Many people aren’t too concerned about retirement when they are just getting their families started, but the sooner you can start planning, the further ahead you will be as time goes by. In fact, as USA Today explains, there are a number of benefits from starting retirement planning early in life. It’s a chance to increase your net worth, improve your credit rating, and it’s a great way to get comfortable with investing. If you play your cards right, you might even be able to retire early!
Examine the various retirement plan options to decide what’s best for you and your family. If you aren’t sure of your situation or need help assessing your goals, a retirement calculator can give you a better feel for things.
Look into how an MBA can help your family’s future.
When planning for your family’s future, it can become daunting to think about growing in your career, saving for your kid’s college, and owning a home. One tool that can greatly impact your financial security is an MBA. By taking advantage of this next step in your education, you are re-investing in yourself.
Studies show that an MBA can increase your pre-MBA salary by up to 50%! That’s an amazing investment that can also come with the added benefit of an increased professional network. A strong group of connections will allow you to advance in your career and provide ample prospects when looking for new opportunities.
Consider your kids’ future.
Are you planning to help pay for your children to attend college? If so, there are some key options worth considering. You can establish a savings account, invest in a 529 plan, or choose a prepaid tuition plan. Another option is an UTMA or UGMA, although your children can elect to use those funds for something other than college tuition, which some parents consider a downfall.
Don’t forget daily spending.
No matter how well you plan for the future, if day-to-day spending isn’t realistic, you’ll never meet your goals. With that in mind, organize your income and bills. As U.S. News explains, a practical budget can help you identify where you are currently spending, and where you need to make changes to achieve all you dream of for you and your family. There are several budgeting systems to consider, and they all come back to tracking your income and outflow carefully.
Sorting out details
Making solid choices for yourself and your children can be confusing. Sometimes families do best connecting with advisors for advice, and there are a couple of key professionals who can assist you with sorting out details. An estate lawyer can provide insights on creating your family’s safety net, and a financial advisor can assist you with budgeting and investing decisions.
Taking great care of your family won’t happen by chance. Examine your goals and how you can best reach them. With good plans, you ensure security for you and your loved ones.
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Article writen by Emma Grace Brown