This is a guest post in collaboration with the NRMA. Photo credit for above image: Credit: FreeDigitalPhotos.net
To all the new mums reading this – congratulations.
At this moment your life is totally devoted to that special little person who needs and deserves so much attention – and rightly so.
Many mums are too busy to think about one of the most important things that affect your family’s wellbeing – money. But by starting your child out on the right money path will set them up for the future.
Here are the top five financial considerations for thrifty new mums:
1. Open a savings account for your bub
Okay, it’s a bit early to start giving your newborn baby pocket money, but you can still set aside a bit each week. By the time they’re 18 you would have helped them get financially ahead.
Here’s a scenario: say you set up a high interest savings account with a 4% interest rate and an automatic deposit of $20 a week. By the time your child is 18, the balance will be over $27k. Enough to pay for their first car, university degree or even go towards purchasing their first home!
2. Invest like a pro
If you want to earn a bit of extra cash – learn the art of investment. There are plenty of investment options for beginners, such as a diversified investment portfolio, which means the portfolio is spread out over a variety of investment options, ultimately reducing the amount of risk.
Another great option for a newbie mum looking to enter the investment game is a managed fund by a financial planner, who can help advise you on the best investment options for your situation. Just make sure you invest an amount over $1,000 or the fees could eat away at your dough.
3. Protect your family with life insurance
Now that you’re a mum, you’ve probably realised how precious life is. However, have you considered what would happen if you weren’t around due to illness or death? We know it’s not nice to think about these things, but it’s something that shouldn’t be overlooked – that’s where a life insurance policy comes into play.
What is life insurance? It can protect your family by paying for living expenses (rent/home loan repayments), gas/electricity bills, car loan repayments and groceries if something happens to you.
It’s important to always do your homework when selecting a policy to ensure it is right for your family. Choose a reputable insurer and compare policies of life insurance quotes online.
4. Write a will
Sorry, another hard topic to think about, but it’s important for your newborn baby! A will is a clear way of setting out who will inherit your property/savings/estate after you’re gone. It’s important to take the time to create a will because if you don’t, others will decide who receives your inheritance.
5. Look for tax breaks / benefits for parents
Last, but not least, make sure you check what benefits you’re entitled to. Motherhood brings with it plenty of hefty costs, but thankfully, in Australia you’re entitled to up to 18 weeks financial leave.
There are plenty of other payments that you may also be entitled to, including the Family Tax Benefit, Parenting Payment or Rent Assistance. Every little bit counts!
How about you – do you have any financial tips to offer to new mums?
Disclaimer: This is a guest post in collaboration with the NRMA.