January, Wednesday 23, 2019
Raising a young family is financially-demanding. According to Nerdwallet, it costs about Dh954,850 ($260,000) to raise a child from zero to 18, and the cost can quickly go up to Dh2,738,340 ($745,634) when you add luxuries like birthday parties, toys, and gadgets.
Because of this, parents often find it difficult saving for retirement or even for the kids’ college education. But savings is a necessary step if you really care about your family and want to guarantee them financial stability.
So how do you save while raising a young family? Here are a few tips to help you out.
Have a Clear Retirement Goal
You don’t have to lower your standard of living after retirement. So, it is paramount that you have a clear idea of how you want to live after retirement and make a financial plan that will allow you to sustain your lifestyle.
A sustainable retirement plan should stretch from 20 to 30 years after retirement even up to 35 to years. According to the U.S Social Security Administration, beyond the age of 65, a man could live until 84.3 years, while a woman could expect to live until 86.6 years.
These factors should be taken into consideration to ensure you have an encompassing plan to fall back on after retirement.
Evaluate Your Present Financial Reality
A proper evaluation of present financial reality is the ideal starting point for financial planning. When raising a young family, you and your spouse should keep track of your investment statements and make sure they are organized according to purpose. For example, accounts for retirement should be different from the accounts for kids’ education, and home purchase. This will help you identify milestones and time required to achieve them.
Seek a Trusted Financial Advisor
Obviously, the best form of savings is investments. Investing in secure financial products will not only help to shield your savings against inflation but also guarantee returns.
To get started, you must assess your risk tolerance and discuss such moves with your spouse. But more importantly, you should contact a trusted financial advisor to ensure that your capital is properly allocated and managed.
The financial experts at Nexus can help you create tax-efficient and flexible savings plan tailored to your needs and personal circumstances.
Prioritize Your Kids’ College Tuition Cost
On average, college costs about $43,700 per year, today. Factor in inflation spread over the period of 16 to 18 years and the cost can become overwhelming. To make sure that college costs don’t derail your savings plan, it is important to make saving for your kid’s college tuition a priority.
Fortunately, for expats living in the Gulf region, our specialists spread across UAE, Bahrain, Kuwait, and Qatar can help you create a savings plan tailored to your family’s financial reality.
Pick the Right Health Insurance
Picking the right health insurance coverage ensures your family is protected without you having pay for unnecessary additional fees. This will ensure that you continue to save no matter the health challenges that befall any member of your family.
In the Gulf region, the idea as to who is responsible for providing health insurance for employees and their dependents differ from country to country. Even in some countries, the laws often differ from state to state. To be on the safer side, discuss this with a trusted insurance advisor and take the necessary steps to ensure that your family members are covered.