Welcoming a new family member is exciting but with so many aspects of your life changing, when it comes to your finances some forward planning can make the transition so much easier.

Fortunately, babies allow several months to prepare for their arrival and it’s easy to get caught up in the excitement. When making preparations it’s important to have all of Bub’s needs ready; but it’s equally important for Mum and Dad to be financially organised.

It’s wise to conduct a review of your financial affairs as early as possible, even before you start your family. An idea recommended by the Australian Securities and Investments Commission (ASIC) is to draw up a “baby-budget”. Do this by listing all household income and expenses under three columns: before pregnancy, during pregnancy and after pregnancy.

This allows you to see and compare your financial position at the different stages you’re going to experience.

If you have difficulty keeping track of incidental spending you’re not alone – many people can’t account for where their money goes. To help, ASIC has developed an app you can download from its Money Smart website, www.moneysmart.gov.au called TrackMySpend. It suggests using this app for two weeks prior to completing your baby-budget and reports that people are often surprised by the results.

Determine your entitlements

At least one parent will probably take time off work and the potential reduction of household income can be daunting. Understanding your support entitlements upfront can relieve some of the worry.

The federal government offers eligible parents up to 18 weeks Parental Leave Pay. Centrelink has a Paid Parental Leave comparison estimator on its website, www.humanservices.gov.au. This tool will estimate your entitlement and enable you to determine the best option for your family.

If you decide to return to work after Bub arrives, you may qualify for government assistance with the cost of childcare. The Department of Human Services can provide information about your eligibility. See www.humanservices.gov.au.

Planning = less stress

People often set up a savings strategy for key life events like buying a home, a major holiday or retirement. Having a baby is more than a key event – it’s life-changing – yet few people consider saving for it.

Your financial adviser can assist you in creating a practical household budget, and set up a savings plan that will help cover large or unexpected costs. At this time you should also consider life insurance to protect your family’s future.

Planning ahead will provide peace of mind and place you in the best possible position to welcome the newest member of your family. For more advice on forward planning, contact us at Leenane Templeton on
02 4926 2300.

Sources:
www.moneysmart.gov.au  Having a baby
www.humanservices.gov.au  Parental Leave Pay
www. humanservices.gov.au  Compare your payment rates

The post Baby budgeting appeared first on Newcastle Financial Planners & Financial Advisors.

    Beliefs, attitudes and behaviors are developed at an early age.  Much effort is spent to save our children, educating and teaching them important values,  but what about the importance of money and savings?

Many parents give pocket money without developing basic financial principles.  By teaching a framework that you are comfortable with at an early age you will install not only the importance and value of money but lifelong values to set them in the right direction.

Money Box One they have total access to the money and can take out to the shops to spend on whatever they like,  they also like to role play with the money.

Money Box Two is only for special items they are saving for,  eg a special toy or game that may take some weeks to save up for and then buy it themselves, giving them a sense of pride that they have achieved a valuable purchase.

Money Box Three has a secure lid and shows the  how much money can grow over the years, which when full gets placed in their bank account. This is used in later years to invest in shares, showing them whatever your particular strategy is. Mine is again a 3 bucket share strategy with high risk, medium and low risk with varying percentages within each depending upon their age.  Speak with your financial advisor to see what strategy best suits you and your family.

This helps install a principle which should follow them through life, (I know because my parents did a similar strategy with me…which made me passionate about saving and investing). As a family we also have investment funds set up for the children and I hope that when they come to the age of receiving this money they will have the common sense to invest it wisely!

Harlan Marriott

Marketing Manager  

www.financialadvisor-newcastle.com.au

The post Save Our Children appeared first on Newcastle Financial Planners & Financial Advisors.