Watch for lifestyle inflation when your child starts grade school – You’re probably dreaming of the day when your child starts kindergarten and your budget starts to ease. However, if you don’t plan for it, you will end up spending that money before you know it. Plan ahead! See the next tip…
It’s not too early to start saving for college – but fund your retirement and emergency savings first. You know the old saying “put your oxygen mask on first, before assisting others”. It’s true in finances as well. When you have a solid foundation of emergency savings and retirement contributions, think about college savings. Start thinking about how much you are willing to contribute, how much you expect your child to contribute through part-time jobs or earning scholarships, and whether your want your support to be tied to grades.
Watch spending too much on activities and interests – Activities for preschoolers are big business. In the last two years, my kids have tried gymnastics, swimming, soccer, ballet, and ice-skating. We haven’t even gotten into music, or art, or theater, or foreign language. Watch for over-scheduling them at the expense of your sanity and your budget. Plenty of time for that when they get older!
Spend in areas that improve your lives – Spend your money in areas that help you as a parent have more time for your family like housekeeping and lawn care. Order food in so you don’t have to cook or clean up. Take a vacation the whole family can enjoy and remember for years to come.
Have a night out – think about instituting date night or a night out with friends. Although the costs can add up if you need to get a babysitter and pay for dinner, drinks, etc., you will feel renewed when you get home, and an investment in your relationships may be the best investment you can make.