Having a family is expensive. You have the everyday expenses. Food. Clothes. Shelter. The emergency expenses. Accidents. Injuries. Repairs. So many repairs. And the long-term expenses. College. Weddings.
Add it all up and what you get is — well. More money than most of us care to think about. And yet families all across the world make it work. In this article, we talk about how you can deal with the inevitable financial stress of parenthood.
Understanding the Financial Challenges of Parenthood
People talk about how kids are expensive, but it’s easy not to understand the scope of this when you are an expecting parent, or even when your children are little. Sure, they need food, but you were buying that anyway! Clothes. Those can be expensive, but they don’t have to be. There are some good thrift stores in the area, and buying secondhand is much better for the environment anyway…..
It is possible to eliminate many of the financial stresses of parenthood through careful planning. We will touch on that later. However, there are some expenses that are harder to anticipate and avoid.
The Dreaded ER Visit
Go ahead and laugh, but there will be a 3 AM in your not-so-distant future where you stand over the crib wondering if your daughter’s snot is green enough for you to go to the emergency room. Most parents will make at least one frivolous trip to the emergency room with their child. Especially their firstborn.
It’s natural. They are little, and agile. And they always seem to develop weird symptoms just after your regular doctor’s office closes for the weekend.
Then there are the not-so-frivolous visits. Hopefully, these don’t come up at all, but hey. Kids like to move fast and recklessly. Injuries happen, and when they do, it gets expensive fast. Even a routine visit to the ER without any major tests can cost hundreds of dollars.
Piggybacking on our last point, there are also visits to the regular doctor. Usually, insurance will pay for their annual visits, but everything else will come with a copay. These are typically not crippling—hovering in the $20-50 range.
But let’s say your kid is prone to ear infections — they all seem to be. Not only are you going in every time they pull at their ear, but then you need to pay for the subsequent prescription (copay) and the follow-up (copay. And they noticed a little fluid at that follow-up. Not infected, but not not infected either. Can you come back in two weeks?
Copayz add up.
Sports and Co-Curriculars
Your children are going to want to be involved in activities. At school, outside of school. You may not put up the green light for all of them, but you’ll certainly want to give them as many opportunities as you can. Unfortunately, most of these opportunities come with a price tag.
Even public school sports programs come with fees. Equipment, new clothes, and so on.
College is the expense that looms largest in the minds of most parents. You know you should be saving for it, but how much can a person reasonably set aside for an expense that is so massive? Unless you are a distinctly high earner, shelling out what equates to the price of a house over the course of four years (per child) is not something most parents are ready for.
Making it Work
And yet, despite the financial challenges of being a parent, families at every income level, all across the country, are making it work. How?
Live Within Your Means
The biggest and most foundational key to financial solvency as a parent is to ingrain the habit of living within your means. There are many things that you can buy as an employed adult. You’ll find, for example, as you shop for cars or homes, that banks will often lend you more money than you would have thought.
It’s nice, you think. I guess we can start looking at finished basements after all. And maybe you can, but it’s important to think not just about getting approved for the loan, but also about what it means for your lifestyle in the long term.
Will you be able to comfortably afford those monthly payments, even when one of those ER visits we talked about earlier come up? Moreover, will you be able to afford those payments and continue to meet your long-term savings goals? Being sensible with your big purchases makes it easier to afford the littler expenses of parenthood. Or, for that matter, life.
Look for Cost-Saving Opportunities
There are lots of ways to make essentials more affordable. Discount grocery stores offer more or less the same products for a steeply discounted price. You may not be getting brand names, but for the money you save it hardly matters.
We also mentioned shopping for clothes at thrift stores earlier. This is a practice that has something of a connotation. People think bad clothes, are only there for the neediest of shoppers.
That’s really not the case. Many thrift stores specialize in only lightly worn garments. And shoppers choose them for many reasons. Cost savings, sure, but maybe also because they like retro stuff. Or they want to be eco-friendly. The fashion industry is an enormous polluter. By buying secondhand, you reduce your family’s carbon footprint.
Make a Budget and Stick to It
Budget making is a good long-term way to ensure a healthy financial life. By knowing how much you can afford to spend each month, you guarantee that you will be able to consistently put money away to hit your savings goals, and have the funds to handle family-related emergencies. Financial planners are an accessible way to manage your goals and make smart choices.
Life as a parent is always expensive, but by taking a proactive approach, you can help ensure that your family is ready for whatever comes it’s way.
This content is made possible by Andrew Deen.
Photo credit: iStock.com