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Starting a family means starting an entirely new chapter of life. Everyone’s family is going to look a little bit different, of course, but it’s always important to have your finances in order. These are some of the most basic and essential financial moves that you can make when starting your family.
Get Life Insurance
Life insurance is critical – and even more so if you have individuals who are dependent on you, like children. Life insurance varies in coverage, cost, and scope, but generally, it works as a safety net in the case of death. If you are the primary breadwinner for your family, your death would put them in a very difficult position. Your partner would have to try and find a job in the midst of grieving. Your death will also be expensive – with everything that goes into funeral costs. Life insurance will provide a significant payout that creates a financial cushion for your loved ones in the worst-case scenario. They will be able to pay the bills until they adjust to life without you in several months or years.
Create a Will
A will is important to create legally. It will cost money – probably working with a local lawyer to draw it up – but it’s well worth the cost. Basically, a proper will ensures a smooth legal transition of your assets and wealth. Without it, your loved ones could find themselves having to go through probate court to try and get their inheritances. The probate process can take months or even years to complete, so make sure your will is legally binding and not just something you’ve written up by yourself. A smooth transition of wealth can also provide financial support after your death.
Start Saving
That can be quite tricky, especially because new families traditionally come with lots of unseen costs (babies tend to be expensive, after all). But even so – it’s critical that you start saving as soon as you can. Savings will be incredibly helpful in the future. You never know when extracurriculars, university attendance, or a medical emergency might suddenly demand more than what you have on hand. Try and make a budgeting and savings plan according to your current finances.
There is no such thing as an easy family. It’s going to be hard – and probably in a lot of ways that you won’t expect. But armed with the right financial knowledge, you can prepare to weather the most damaging storms together.
Check out this article on what to buy for a new baby!
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