5 top financial tips for new parents
When your bundle of joy arrives financial matters might not be at the top of your list of priorities, but with a new or expanding family, it’s best to get your finances in order.
Here are five tips for new parents.
1) Protection– It’s never nice to think about death or serious ill-health, and that’s why many of us put off arranging life assurance or critical illness cover until it’s too late. But with additional responsibilities it’s more important to protect your family should the worst happen to you. The day-to-day cost of raising a child is often overlooked when families try to work out their life insurance needs. The weekly cost of raising a child is £197, which is £184,392 over 18 years!
2) Gifts– On a happier note, a new arrival normally sees friends and family giving the new one gifts. But there are only so many money boxes, or silver items you want to polish, so why not consider drawing up a gift list or asking for cash instead? That way you can start baby off with their own little nest egg e.g. money towards university, their car, etc.
3) Savings– Many people give money on Christening, birthdays, etc. so it’s a good idea to put this away for baby’s future as they grow up so fast that university will be here before you know it. Investing in a junior Isa (JISA) is one way to grow the baby’s money over the next 18 years.
4) Wills– Too few people even have a Will, let alone keep it up to date. But with baby’s arrival you should arrange, or update, your Will to ensure that you have addressed the thorny issue of guardianship and, if you are unmarried, that your partner is provided for.
5) Child Benefit– All parents should claim Child Benefit which helps cover some of the additional expense of children. Unfortunately if one parent has an income over £50,000 a year you lose some or all of your Child Benefit by way of a ‘High Income Child Benefit Charge’. If either parent has an income over £60,000 it may seem pointless to even register for Child Benefit as the tax charge wipes out your entire Child Benefit. However registering for Child Benefit is essential to ensure that non-working parents qualify for National Insurance credits towards their future state pension.
(by Scott Gallacher)
Here at Logic Wealth Planning we think it’s never too early to start planning for your baby’s financial future. For friendly and professional guidance on Life Assurance, Critical Illness cover, Wills, Junior ISAs and other savings options we can help and advise you.
As one of the leading IFA practices in Greater Manchester, Logic Wealth Planning has a team of experienced Financial Advisors specialising in Wealth Management. Working closely with clients in the Heywood, Rochdale, Bury and surrounding areas across the North West, we believe that however modest your income may be, when it comes to Pensions, Savings and Investments we provide the best financial advice, ensuring that your money is working hard for you and allowing you to enjoy a comfortable lifestyle right through to and including your Retirement years. For your first meeting with us – entirely free and without obligation – please call us now on 0808 1234 321. We look forward to hearing from you.