This is a collaborative post.
In today’s economy, it’s easy to feel overwhelmed when thinking about planning for your child’s future. But you can begin to save for your child’s future even before they are born. You have to be prepared for whatever course of action your children take. Whether that is to attend college, pursue a vocation or follow their freelance dreams. Coming up with funds can seem a little scary at times. So I’ve put together some simple ways that you can prepare for your children’s financial security.
3 Ways to Save for Your Child’s Future
1. Get a Hold of Personal Debt
One of the most important factors to consider when planning for the future is your own personal debt and your ability to save. Taking care of your current financial responsibilities will allow you to see what is possible in the future. By accounting for your own student debt, high-interest credit cards, or other loans, you can get a better picture and make decisions based on timing and strategy.
A good way to easily tackle some of your own personal debt and start saving for your children is to refinance current obligations. By refinancing, you can lower your monthly payments. This allows you to put more money aside for your children much sooner. Other strategies, such as zero-percent balance transfers, taking the snowball or avalanche approach to debt repayment, and preventing unnecessary spending can also help you set aside more for the future.
2. Growth Accounts
Whether you’re putting money aside for college or simply for your children’s future expenses, it’s important that you put it into an account that will grow. If you make your money work for you then the saving process becomes much easier.
Opening a 529 college savings plan is a smart way to save after-tax money that will grow and remain tax-free all the way through college. And a benefit of this type of savings account is that you can transfer the account to your child once they’re born or when they’re ready for college. This option gives parents more control and flexibility over their savings for higher education.
3. Your Employer Is Your Friend
Many employers offer tuition savings plans and even private scholarships. By using immediate resources such as these, you can enjoy extremely convenient savings and reap wonderful benefits. Using existing employer savings plans can mean having money directly deposited into a savings account. Automating the process makes saving money less stressful. Also, people don’t tend to spend money that they can’t see. Funnelling funds into separate accounts allows your money to grow and helps you to avoid the temptation to spend your savings.
Whether it’s getting a hold of personal debt by refinancing or opening a new account for college, saving for your children’s future can begin as early as today. Financial security is one of the many lessons we teach our children. We must lead by example when showing our children financial responsibility. The sooner we begin planning for whatever life may throw our way, the better off our children will be now and in the future.
What actions have you taken to look after your child’s future? I would love to hear in the comments.
This is a collaborative post.