5 Ways to ensure your kid’s future is Financially Secure!

Welcoming a new life into the world entails plenty of additional responsibilities as well as financial obligations. For any parent, welcoming a newborn into the world is an exciting and wonderful moment. As parents, we want the best for our children, and securing their future is the primary goal. There are various steps we may take to establish a solid foundation for our newborn's future, ranging from financial planning to fostering a safe atmosphere. Are you also planning a family ahead or you already have a kid and want to ensure your kid has only the best in the future? Well, that requires foolproof planning. In this blog post, we will explore 5 crucial ways to ensure your kid's future is secure.

1. Open a joint account for your kid - A standard savings account for your kid is an excellent place to start. Every month, you save money by putting a portion of your earnings into the joint account. But the interest rate on a savings account is so low, it may not produce the same outcomes as other investment strategies.

2. Start your SIP journey - SIP stands for "Systematic Investment Plan," and it refers to investing in mutual funds at regular intervals of time, usually monthly or quarterly, rather than depositing a large sum all at once. It is the finest technique of investment for saving money for children as investing a small sum is easier than investing a large amount of money. You can begin by investing money received as a gift at baby showers or children's birthdays. Instead of wasting your money on frivolous purchases, put it to good use.

Note- Please bear in mind that there are various variables to consider before investing your money. To reduce risk, it is preferable to seek professional assistance.

3. Make a separate budget for the child's requirements - As your children develop, so will their needs, so be sure you have a budget for everything. The cost of raising a child in a middle-income family, according to a USDA estimate, is $12,980 per year(Source) A well-crafted budget is required to ensure that you have a figure in mind for all expenses.

What your budget should mostly include:

• Doctor's visits
• Basic necessities such as clothing and furniture
• Outdoor activities and family trips
• Education costs

4. Identify and Invest in your short- and long-term goals separately - For example, if you wish to register your newborn in speech therapy after a year or two, this will be counted as a short-term goal.

Before investing on long-term goals, strive to define your long-term goals. Long-term goals for your child may include education costs, extracurricular activities, travelling to study abroad, getting married, etc.

Parents and children can sit down and talk about short-term and long-term financial objectives. These goals could be goals for the child and may or may not include household expenses.

Depending on the goals established, a small percentage of the funds can be put in various investment products to form a portfolio for the child.

Note- As an investor, you should seek the advice of a professional financial consultant with the appropriate expertise who understands your risk tolerance and investment objectives.

5. Invest in your kid's skill development - Early childhood education is critical for children's brain development. You should invest in skill-based learning programs for your children as a parent to ensure their entire growth.

To stimulate learning and curiosity in children, parents can begin by reading to them, as this will build a reading habit in them.

Invest in educational toys and tours because children are naturally curious from a young age, and this curiosity will aid in their brain development.

Enrol your children in useful skill-based courses such as money management, personality development, athletics, and so on when they reach the appropriate age.

What FinLigero can do for parents:

FinLigero can help parents choose appropriate investment options for their kids depending on the factors including but not limited to:

1. Age of the kids
2. Financial condition and risk appetite of the parents
3. Short-term and long-term goals of the parents for their kids which also depends on the goals of the kids

Conclusion:

You can build a solid foundation for your kid's growth and development by applying these five critical measures to ensure their future is secure. Every decision you take, from financial preparation to creating a safe environment and supporting education and skill development, will contribute to a brighter future for your child. It is never too early to begin planning for and making investments for your child's future.

Do you still have problems with investment planning and risk management? Please feel free to visit our website, call us, or write to us, and we will gladly assist you with your concerns.