Understanding the intricacies of child psychology will help you raise wonderful children, but it’s only one half of the complex equation of parenting. The other half is your organizational skills, particularly with money management. Financial planning before and after having children are slightly different, and you need to understand both scenarios to provide your children with a happy home and the best opportunities in life.
Let’s take a closer look at some basics checklists of things you need to do before and after you have children.
Financial Planning Before You Have Kids
Besides the checklist we covered in a money management article on how to prepare yourself financially to have kids, which discussed practical ideas like having a stable income, a budget, an emergency fund, a baby fund, a retirement plan, a credit card debt, a college fund, health insurance, and stable housing, also consider registering early for baby purchases, purchasing life insurance, and creating a will.
Financial Planning After You Have Kids
Although you will have covered many of the basic financial planning steps in your earlier checklist, a few new ones will arise, too. Specifically, getting financial assistance if your child has unexpected medical costs, adjusting how much you contribute to your HSA, and getting term life insurance.
1. Resources for medical financial assistance.
If your child is born with a rare disease, such as cat eye syndrome or some other genetic disorder, and this not covered by your health insurance policy, many resources are available to get financial assistance for various medical expenses:
- USA.gov has links to many federal resources. Their direct contact number is 844-872-4681.
- Needy Meds, a nonprofit organization, lists programs for parents who can’t afford healthcare costs. Their direct contact number is 800-503-6897.
- The Patient Advocate Foundation (PAF) provides parents with case management assistance for debilitating diseases. Their direct contact number is 800-532-5274.
- Family Voices provides family-centered care for children with special health care needs. Their direct contact number is 888-835-5669.
- The National Organization for Rare Disorders (NORD) provides patient advocacy for children with rare diseases. Their direct contact number is 800-999-6673.
- The Assistance Fund provides patients with chronic illnesses that help to cover FDA-approved medications. Their direct contact number is 855-845-3663.
- Good Days provides patients with serious conditions financial help with travel and medications. Their direct contact number is 877-968-7233.
More information about these resources is available on the National Institutes of Health (NIH) website? You can also contact them directly at 1-888-205-2311
2. Adjusting Health Savings Account contributions.
Your Health Savings Account, or HSA offers you pre-tax medical savings account if you’re enrolled in a health plan with high deductibles. There is no Federal income tax to your contributions at the time of your deposit and money that you don’t use in any particular year will roll over into the next year. Essentially, you’ll be able to grow your income tax-free. You can use this money for a variety of baby-related expenses, such as infant formula, doctor’s expenses, health treatments, or health products.
3. Buying term life insurance.
It may feel a little strange buying term life insurance since you’re planning to be around for many years, but, in return for a modest monthly premium, you’re protecting your spouse and your children from any worst-case scenarios. If you’re thinking it’s just one more cost, then you’re overlooking a simple fact: this type of insurance will cost less than getting an online movie streaming service each month. In return for a paying a small amount of money each month, you’re protecting your family should there be an unexpected tragedy.
Bringing children into this world and raising them is a wonderful experience and does not have to be financially stressful if you’re willing to learn basic money management concepts.