One of the greatest struggles of parents today, most especially moms, is securing the family’s finances. That’s why a lot of parents take extra jobs or want to earn additional income and seek other financial sources to keep up with the family’s needs and lifestyle. So, how do you ensure that you have money saved for an emergency, retirement, and other purposes?
Below are some ways you can protect the financial future of your family.
Set clear goals
If you don’t know your long-term objectives or where you want to be in the future, it’s impossible to cast a long-term vision for anything. Consider what you want to achieve, and before you do anything else, take a moment to daydream.
The simplest method to do this is to start writing down any ideas that occur to you on a piece of paper or dry-erase board. Your spouse or long-term partner should participate in the activity if you’re married or have one.
The greater your analysis, the more thorough and specific you should be. This exercise is meant to assist you in determining the type of monthly income flow you’ll need to support the lifestyle you choose. For instance, the measures necessary to achieve and maintain this income level will be very different for someone who just requires $5,000 per month compared to someone who needs $50,000 per month.
Get organized
After some time spent daydreaming and casting visions, it’s time to roll up your sleeves and get to work. Of course, organizing yourself is the first step. Here are some suggestions:
- Create a list of all of your financial accounts. Checking, savings, credit card, brokerage, retirement, and other types of accounts should all be included in this list. All balances should be recorded in a spreadsheet, and login and password information should be kept safe in a password wallet.
- List each of your debts in order of largest to lowest. Then, order your loans on a new list, highest interest rate to lowest.
- Set up both a paper and electronic filing system. Use this for all records, financial statements, and documents you obtain. Then, start promptly putting all fresh documents away.
- Go over your credit card and bank statements. Review all of your income and outgoings. Create an itemized monthly budget using the data here to maximize your savings.
You’ll likely be surprised by how much relief you experience even after organizing. Even if your finances aren’t in terrific shape, just gathering your information and organizing it in one location will set your mind at ease.
Pay down bad debt
Few things have the power to stifle your ability to make money in the future as effectively as bad debt. Bad debt chokes your budget and drains your cash flow, whether it is from credit cards, auto loans, medical expenses, or an excessive amount of student loans. Hence, paying off bad debt as quickly as feasible should take precedence.
Many people begin to play defense when it comes to their debt. They pay the bare minimum and merely “kick the can” forward till the following month. Yet, you must take the initiative with debt if you want to position yourself for success. Being on the offensive entails using every extra dollar you have after paying for necessities like shelter, food, medical care, and transportation to make debt payments.
Build an emergency pool
After you’ve protected your family boat from potential threats, it’s time to replenish the emergency fund pool. You may have noted that even a tiny contingency plan would cost money, and there is no insurance to cover income loss due to job loss.
You must assume this risk without insurance, and an emergency fund will help you do that. Three to six months’ worth of pay can be set aside in this pool. Yet, you can aspire higher given the circumstances from COVID-19. Keep in mind, though, that the low rate of interest on savings means that money in your emergency fund might not be able to help you accumulate wealth.
Teach your children about money
One of the appropriate things to do is to continuously invest in your children’s financial education. They will, ideally, receive a portion of your fortune in the future. You want to be sure that anyone you would financially assist, including your children, is capable of handling these assets.
In the United States, financial literacy is currently at an all-time low. Simply put, you can’t rely on the education system to teach your kids about money. You are responsible for teaching others about budgeting, investing, and spending.
Take Advantage of Government Financial Help
One way to protect your family’s future is by taking advantage of government financial aid and services, like social security disability benefits. If you have a sick family member, for instance, you don’t have to shoulder all expenses – the government is always there to help.
The Social Security Administration has an impairment listing manual or blue book that lists a number of physical and mental impairments, automatically qualifying a person for Social Security disability benefits or SSDI.
You or your loved one’s medical condition doesn’t need to exactly match the listing requirements to be awarded disability benefits. The important thing is that it’s medically equivalent to the listed criteria or related to the listing. Even if you don’t meet the criteria, you can still be eligible if your condition restricts you from functioning or working. A disability attorney can help you ensure you get the maximum benefit, so click here for more information.
Here are the common medical conditions listed in the blue book:
- Cancer
- Musculoskeletal problems, like back injuries
- Respiratory illnesses, like COPD or asthma
- Cardiovascular conditions, like coronary artery disease or heart failure
- Speech and senses, such as hearing loss and vision problems
- Mental health disorders, such as anxiety, depression, schizophrenia, retardation, or autism
- Neurological disorders, like cerebral palsy, multiple sclerosis, epilepsy, and Parkinson’s disease
- Immune system disorders, like lupus, HIV/AIDS, and rheumatoid arthritis
- Syndromes, such as Marfan Syndrome and Sjogren’s Syndrome
- Skin disorders, like contact dermatitis
- Digestive tract problems, like irritable bowel syndrome or liver disease
- Genitourinary and kidney problems
- Hematological disorders, like hemolytic anemia and bone marrow failure
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Get Life Insurance
Life insurance can help safeguard your family’s future. While you’ll be paying insurance premiums depending on your preferred payment terms – every month, quarterly, or yearly – the benefits of getting life insurance are helpful in securing your family’s future, most especially if something happens to you. Be sure to check out average rates and options for your family.
This is because a life insurance company can pay a death benefit to the beneficiaries of the life insurance policyholder.
Here are the financial benefits of having life insurance:
- Pay Debts: Life insurance is one way to secure that your debts will be paid if you die. Without insurance, all your assets might get lost just to pay all your debts, leaving your children with a financial burden.
- Funeral Cost: Funeral expenses can be costly, so having life insurance will financially help your family when you passed away.
- Build Savings: You can get life insurance for your children to help them build savings and use the cash portion for a major investment in the future. It’s also applicable if you’re worried about your children getting sick or acquiring serious health issues.
- Retirement Strategy: Insurance products differ, and some people use it as a Retirement Planning strategy, which means getting back the amount paid and interest on the maturity date of the investment portion of the life insurance.
Save and Find Other Income Generating Sources
One way to protect the financial future of your family is to find other income-generating sources. You can also earn money without leaving home, most especially if you have several children to take care of. For instance, you can start an online business or digital marketing firm that your children will also eventually manage in the future.
Here are some examples of income-generating sources to help secure your family’s finances:
- Family Business: You can start a garage sale or small cafe, repair shop, barbecue, or boutique in front of your property. Many successful family businesses started as small scale businesses.
- Online or Digital Marketing Business: Learn about content writing, SEO, social media marketing, affiliate marketing, or any digital marketing niche you want to excel so you can start an online business without leaving home.
- Homemade Goods: If you love baking, artwork, pottery, or creating DIY things, you can sell them online through major marketplaces, like eBay, or in social media, like Facebook.
Conclusion
The best ways to secure your family’s finances include getting insurance, taking advantage of government aid or financial benefits, and finding long-term income-generating sources. With hard work, patience, and smart investment, you’ll have something to spend in times of emergency or difficult situations. Most importantly, you have peace of mind that your children will finish their studies and will have better lives.