Baby financial planning 101
CHILDREN are expensive to raise; in fact, often when planning for a child, many people don’t take into consideration the huge financial burden that they will be for the next 18 years.
Michelle Sinclair Doyley, manager of client financial education at JMMB, shared the tips below at last Friday’s Muminar seminar at the Jamaica Pegasus Hotel.
1. Have a family budget
This way you will see how much money is coming in and how much money is being spent. This will allow you to evaluate your expenses and goals as well as exercise control over your spending.
2. Have an education plan
The cost for university is high. Plan ahead to know how much to save and what sort of expenses to expect when your children get to that stage of their lives. For example, tuition, books, food and clothes will cost a pretty penny. Instead of the tablets and expensive phones as gifts, put the money into an education fund.
3. Plan for your retirement
You need to know the cost for your retirement. While you have an education fund, also have a retirement fund. You want your children to succeed and fly, but how can they fly when they have to be responsible for you? Set up an automatic transfer and have funds transferred by the bank to the retirement account.
4. Emergency fund
Emergencies will creep up on you no matter how careful you are. Even the best laid out plans do not always happen as planned. Having this in place will make you prepared for unexpected expenses.
5.Save
No matter how little you earn, save. Every penny counts. Understand your income and set up an automatic transfer with your financial institution to a savings account and watch your money grow.
6. Money management
Developing good financial habits will help prepare your children to make future financial decisions in the future.
— Kimberley Hibbert
