Financial planning is one of the most important aspects of life for every individual. This assumes greater importance when you're married with kids. Then, you don't only have to plan for yourselves but, also think and plan accordingly for your child's future
Ideally, parents should start planning the kids' finances right from the time of their birth. It's very important not to procrastinate on financial planning for children and push it to a later date.
Here are some important tips which will help couples to plan their finances well to secure the future of their family.
1. Analyse your condition: While many couples may have a decent income, sadly their expenses are also usually shooting of the roof. It's important to keep a check on your spending and thoroughly analyse your financial standing.
2. Insure your family: The moment you start a family, you should secure it for any unfortunate event which may result in a financial havoc. This will take away a huge burden from your head. Buy a good term insurance plan to secure your family.
3. Save for your child’s education: Planning for your child's education is one of the main concerns for every parent. With escalating costs, it is advisable to start saving at the earliest and also factoring in the future cost of education, say for 15-18 years from now.
Plan your investments in a way that you can get the money at various stages of your child's life – for example, 18, 19, 20 and 21 years.
4. Invest and diversify: A lot of individuals who invest regularly often forget or ignore the importance of diversification. Diversification ensures that investors can gain varied benefits and do not suffer huge losses, which is quite common if the investments are done in a single source only.
So, it's always important to distribute the investing amount among different investment options like mutual funds, equity, provident fund, public provident fund, to ensure that your returns are protected.
