It’s a life changing experience to become a parent because of how many new responsibilities you have to take on. Not only do you need to take care of your own financial needs, but also those of another human being.
There are a few financial moves you should make once this life event occurs.
Consider Life Insurance Adjustments
Life insurance can help you take care of your family financially, even after you are gone. It can provide for their upbringing, education, and other needs. Even if you currently have coverage, it’s a good idea to reevaluate what you currently have.
Great life insurance options for parents are ones that include a value that covers your needs, reasonable rates, and great service.
If you do not have enough, you might need to get more. If you have a policy currently, you can sell it through a life settlement from a provider or broker. That way, you can shop around for coverage that works better for you. You can review a guide on everything to know about the process.
Related: 10 Things Women Need to Know About Life Insurance
Ensure You Have a Will
If you pass away, you will want to ensure your kids will be taken care of. It’s a good idea to create a will now, since it ensures your assets are divided up the way you want them to be.
Many times, parents choose to name their kids as the beneficiary of their funds. That way, your kids will receive your money.
Check out Trust and Will If you’re looking for a more affordable, convenient and easier option for estate planning than traditional means of working with an attorney.
If your kids are underage, you can have a guardian manage everything until your child has reached a certain age, usually the age of majority. Having a will allows you to prevent anyone from contesting your assets, and it allows your kids to be taken care of.
Consider speaking with any potential guardians so you can choose the right person to take over in the event of your death.
Related: The Advantages Of a Last Will & Testament Drawn Up Sooner Rather Than Later
Getting Long-Term Disability Insurance
Another type of insurance to look into is long-term disability insurance. If you are injured and unable to work or get sick, you can still receive a certain percent of your income for the length of time the policy specifies.
It is worthwhile to consider getting this type of coverage. Consider your current savings and expenses when you choose your policy.
Related: 6 Mandatory Benefits An Employee Is Entitled to Receive
Adjust Your Budget
Raising kids can be expensive, and the costs of clothing, food, childcare, and diapers can all start to add up. Having a child and getting medical care can also be expensive.
Some of these things are regular expenses, while other things might require only one investment. You can use budgeting apps to help you build a budget and plan for each of these things.
You should also budget for an emergency fund. If you lose your job or are self-employed, having savings to fall back on can give you peace of mind.
Self-employed people might not always have a lot of work available, so their income can be variable. It’s important to have somewhere around six months to a year’s worth of expenses set aside.
That can give you time to find the right job for you instead of landing a less than ideal job just to make ends meet for a while.