How Can I Secure My Children’s Financial Future

The joy of having a child is immeasurable and that’s why most parents go the extra mile to invest in secure their children’s financial future. It is a feeling that can’t be really defined, and it is fresh every day. Every parent desires to help their children have a better chance at life from birth. Children have a better chance at life when they don’t have to start their independent lives by paying debt. 

Financial security is one of the best gifts any parent can give to their children, but it takes work for the parents.

You may ask, “How can I secure my children’s financial future?” It requires sacrifices and careful planning.

So, how do you ensure your children don’t have to take on loans for their education? These loans strain these children even before they finish their education, keeping them in a rat race for years. Many people have spent most of their adulthood in the rat race of working simply to pay off their accumulated debt.

Here are the measures you can take to ensure your children’s financial future is secured.

Start Early

The earlier you start securing your children’s financial future, the better. Like many other things, the earlier you start, the higher your chances of success. Early planning brings a sense of security and peace of mind, knowing that you’re doing everything you can to set your children up for a bright financial future.

It is excellent that you have taken the first step by asking questions, which brought you to this article. Now, read on and take action immediately, and your children will be grateful for it.

Teach Finance Lessons to your Children

They should know what you want to secure for them because how can they manage and utilize all you would build for them in the future if they don’t understand it? To prevent a future where you labor and make sacrifices to secure their lives financially but have them mismanage them, you must teach them about finance early. Teach them things such as 

• Debt: You can teach them what debt is, how people accumulate debt, the difference between healthy and unhealthy debt, etc. 
• Expenses: Teach them how to track and calculate income and expenses.
• Savings: Teach your children what it means to save, the right way to save, etc.
• Investment: They should know that saving money is good, but cash is grown through investment. Teach them how to invest their money, the types of investments, and how to spot good investment opportunities.

You should teach them all these so that even if you build enough wealth to keep them away from working, they will have the right knowledge to manage the wealth properly.

Also Read: How Money Can Put a Strain on Your Marriage

Make Long-Term Investments on Their Behalf

The race to secure your children’s financial future is not a sprint but a marathon. I can’t get to the finish line instantly, so you must think and act accordingly. 

Long-term investments are a must for obvious reasons: they will make you labor less than you would have if you only want to save money. By making a long-term investment, you will give the funds enough time to grow into a substantial amount when they would access it.

There are many investment opportunities out there, such as Mutual Funds, Real Estate, Stocks, Bonds, etc. Do your due diligence and consult experts in those fields to help you make the best decisions.

Set Up a Bank Account in Your Children’s Names

Set up bank accounts in your children’s names where you will save for them. You can save for different goals depending on the child’s stage. For example, you can start saving for an infant’s grade school, or if the child is already in grade school, you can start saving for their high school and college. 

Ultimately, how you save depends on your income. You want to ensure you don’t starve the family of their essential needs while saving for the future.

Get Adequate Health Insurance

There is a famous saying that says, ‘Health is wealth.’ Remember the importance of staying healthy in everything you are building. It is good to be positive-minded that they won’t fall sick but don’t fail to plan. Therefore, you should ensure that your children’s health is insured. You want to avoid a situation where they have money in a fixed deposit account, and they have to be dealt with by ill health because the funds have not matured for withdrawal.

You can choose a family health insurance package that adequately covers all family members, or if you are more buoyant, you can combine individual and family health insurance. While you secure their financial future, insure their health so they will be healthy to enjoy the secured financial future.

Also Read: 15 Lucrative Income Streams for a Stay-At-Home Mom

Have an Adequate Emergency Fund 

Emergencies don’t inform us before striking; we can’t simply wish them away. Since we can’t be sure that there won’t be any emergencies, what do we do? That is where an emergency fund comes in. An emergency fund is a fund saved strictly to be used in an emergency situation, such as a job loss, to cater to the family’s basic needs.

It is always advised to keep an emergency fund enough to totally cover three to six months of expenses. An adequate emergency fund prevents the family from falling into starvation and depression after an emergency event. The fund also helps you run the family smoothly while you fix things up.

Share Successful Stories of People They Know

Children learn a lot from observation and the people they relate to. How do sharing successful stories of members such as aunties and uncles contribute to securing the financial future of your children?

When you tell the kids stories that they can verify, it helps to solidify the possibility of what you are teaching them about financial success. When you tell them stories about how their aunty intentionally built her wealth through hard work, smart thinking, perseverance, dedication, etc., they will easily be convinced that if they take things seriously, they will be successful because they know this aunty and can verify the claims with her. 

These stories create mental and physical role models for the children, which will boost their confidence and prepare them to win no matter the challenges. And as a parent, it fills you with hope and optimism about your children’s future.

Also Read: Should I Have a Family Joint Account?

Conclusion

A feeling of fulfillment and joy comes from knowing that your children won’t struggle financially to start life, no matter what happens.

Every parent wishes for that, but we know life happens and isn’t a straight path. Therefore, some parents may not be able to provide for their children completely financially, but every parent must do the best they can to make the journey smoother for their children. They will appreciate it a lot when they are grown.

As a parent, be intentional about the financial security of your children.