You don’t need us to tell you what a huge impact having a growing family has on your life and finances. These are the years when it’s easy to overlook or postpone making financial plans, as your time and money is often fully taken up just looking after the day-to-day needs of those who depend on you.
However busy you are, you shouldn’t overlook the need to build up an emergency fund. Having a financial buffer means that if you’re hit with an unforeseen expense, you have something in reserve.
You may be thinking about moving up the housing ladder and buying a family-sized home. Having a mortgage is a major financial responsibility at any age, so you’ll need to think about life assurance. Taking out the right protection policies for your family’s needs may not be at the top of your ‘to do’ list, but arguably it should be. These policies ‘do what it says on the tin’, they offer protection against a wide variety of unexpected events that every year happen to thousands of families up and down the country. Having a policy in place means that if disaster strikes, there’s a financial payout available to help make things better.
Whilst this can be a financially challenging time, it’s important not to lose sight of your longer-term financial objectives, like investing for a child’s education or building up a sizeable fund for your retirement. Money saved now has time to grow through what Einstein called “the eighth wonder of the world”, compound interest. Put simply, compound interest means having interest you earn added back to your investment, providing a greater base from which your money can grow year on year.
And one last but very important thought: make sure you have a will in place. Every adult should have one.
