Congratulations on stepping into the new phase of your life, parenthood. While you are enthralled with the idea of being a parent, you also need to be ready with planning that can make your child's life secure. Parenthood is more than just about cuddling a baby with love but also providing financial security in future. While you plan for the education and career of your child, there are more to it that you should consider. There are decisions that need to be your priority. In this article, we enlist five critical decisions to assist you in the management of your household and family budgeting, arising out of the future needs after a new addition to the family.
1. Health Care for mother and child
The health of the mother and child will always be the top priority for you. Even before the child is born, you strive to give the best care to your spouse so that the child's delivery is both safe and healthy. The advance and secure environment of an excellent healthcare facility precisely ensures that. To be able to avail the best-in-class maternity care, a person needs to have access to the maternity care benefit and buying a health insurance cover can help.
Once your wife delivers a child, it is essential to care for the health of your wife and child together. There are periodic check-ups to be done. It requires careful planning and thinking to secure your family's health ahead too financially. Many types of insurance policies ensure just that.
2. Start Budgeting the Expenses for the Child
There are many insurance policy types,and some of them grant you financial security of your child's future. A child expense may broadly include associated health expenses, child's education, marriage, and more in the list. Therefore, financial planning for your child must consist of practical and critical thinking regarding all future (countable) costs from the very beginning. Small tokens on savings and investment in the present can yield fruitful results in the near and the long-term future as well.
3. Use the Gifts Wisely (if someone is giving a financial gift, invest it wisely towards child's future.
Being blessed with a child is good news for the family and all the near and dear ones. You should consider even a small token of money (as a gift) as a long-term investment for your child. Ideally, one should think carefully about the gift amount received to invest for the child's future holistically. Put the money and invest it in a child protection plan through a life insurance cover. It will go a long way in providing the best childcare as a parent.
4. Include the child in your health insurance
Health insurance cover can be used to avert the risk of the child falling seriously ill. There are family floater plans which include risk cover for individual family members and the family.
One should ideally buy an insurance policy which provides health protection for individual members and works out the total sum insured in sync with premium affordability. Majority of the health insurance policies have low premium value in return for the desired amount insured.
5. Increase your Term Insurance Cover
A term insurance plan is a must-have for individuals. A term plan provides full income protection against the untimely demise of the insured (the breadwinner of the family) in this case.
If you already have a term insurance cover, then it is time to think again to extend the coverage of the policy at the time of the birth of the child. Life is uncertain, and with an addition of a family member, your financial responsibilities increase manifold towards the family. It is your responsibility to provide complete income/financial protection to your family, in case of an unprecedented turn of events.
Securing your child's future and assisting your spouse's responsibility towards the family, after you, should be the priority now. A term insurance plan increment is an ideal way to deliver exactly that. You can increase the coverage, keeping in mind the future expenses, your present and future living cost regarding the economic scenario, inflation, or the depreciating value of money.
Life is full of uncertainties at any given point in time. Only through a smart and well-thought approach to savings and investment can one secure their responsibilities towards providing a safe future to the loved ones. An insurance policy, like a term cover, always fits the bill for future family budgeting holistically and rationally. Set aside a part of your income now to safeguard your family's interest. It is both smart and wise.
Varsha Channa grew up in Delhi, India and graduated from the University of Delhi. She has been a keen Finance blogger from 5 years. She likes to read and learn about Finance through various ways.