Practical Ways To Protect Your Children’s Financial Future
In some ways, your children are responsible for their own financial future. When they reach adulthood, you won’t (in theory) be their sole source of financial support, as they should be out there in the world making money of their own.
However, there are still steps you can take to make life a little easier for them financially.
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#1: Teach money skills when they’re young
It’s never too late to teach your children money skills, so do what you can now, no matter how old they are.
You could talk to them when going around the supermarket together, for example, and give them lessons on how to save money when shopping. You could also teach them the importance of saving money when you give them their weekly allowance. The more money-savvy they become when they’re young, the more responsible they will hopefully be later in life.
For more, here is an age-by-age guide to teaching your children about money.
#2: Save as much money as you can
Not only will your efforts to save money show your children the value of doing so, but it will also give you scope for putting money away to help them buy a house, go to college, and those other aspects of life where they will need financial backing.
So, try not to squander what you have on unnecessary items, and find ways to cut back on your usual expenses. You might want to find ways to increase your income each week too, perhaps by considering ways to make a passive income. When you have that extra money each month, put some of it into a savings fund for your children, or be future-thinking about your estate planning, and add it to your own savings, especially if you are thinking about leaving money to your children in a will.
#3: Make a will
We have just alluded to this, and it is something you need to take seriously. What will happen to your assets after you have gone?
Without a will, there will be little control over what happens to the wealth you have accrued over the years, and your children might not inherit everything you want them to. You can read more here: How Probate Works Without a Will. So, don’t leave things to chance. Start planning now and speak to an attorney, because as unthinkable as it might be, you won’t be here forever to provide for your children’s financial needs.
#4: Protect your income
If you become ill, injured, unable to work, or even die, the financial wellbeing of your family could be put in jeopardy.
So, consider mortgage protection, critical illness cover, and life insurance (as examples) as if something catastrophic does happen, the financial risks to your family will be minimized. By being protected, more money can be saved, the risk of debt can be reduced, and your children won’t have to suffer in both the short and the long-term.
For more advice, continue your research online and speak to a financial advisor. The more you can do now, the better, so be proactive and do what you can to protect your children’s financial future.
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Ken Boyd
Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies
(email) ken@stltest.net
(website and blog) https://www.accountingaccidentally.com/