It’s so easy to overspend on groceries that there are plenty of ways to cut back. However, you’ll want to pace yourself so you don’t get overwhelmed — try one of the following savings tips at a time. [Read more…]
Will Having Another Baby Be Cheaper the Second Time Around?
In the last few months my husband and I are coming closer and closer to the conclusion that we will likely have another baby. Not for a few more years but if we have any control over the situation we would like to have another. More for the fact that we want our daughter to have a sibling. Both my husband and I are very close to our sisters and we want our daughter to have that relationship too. Though not the only reason, a big reason we’re choosing to wait to have more kids though is that kids aren’t cheap!
I really don’t think kids have to be as expensive as some would make them out to be but they’re still far from free. The two biggest expenses we need to consider is me being on maternity leave for upwards of a year (and losing some of my income) and daycare.
Preparing the Monthly Budget
Ideally we have another child at the same time our older daughter is preparing to start school. Once our daughter is in school she will no longer need full-time care and likely just a few hours in the afternoon until my husband and I are off work. This will save us hundreds of dollars a month for her current daycare cost. Having an older child in school while the younger is in daycare will definitely be the cheapest option in terms of saving on daycare costs initially.
As we come closer to preparing for me to be on maternity leave our monthly budget will look much better as we will have a significant amount of debt paid off as well. The peace of mind that comes with not having additional debt payments while on a reduced income will be great!
Saving on Baby Stuff
Most of the toys and baby items we bought and received as gifts for our daughter were very gender neutral which will save on upfront costs (and even if they’re not I have no issue with my potential son playing with his older sisters pink toys). There are very few baby ‘’items’’ we would need if we have another child. If we have a son we would need some clothes (most second-hand) as our daughter’s wardrobe is very girly and I draw the line at riding her pink motorcycle.
If possible, I will breastfeed again saving on formula and because we already own a pump and storage bags I wouldn’t need to re-purchase these.
Other than things like new savings account for post-secondary which will come with any future child, the other costs will be very limited. We will eventually need a second bed for him or her and some clothes, but because we have chosen to keep all of our current child’s things there is very little we actually need. Paying off our debt will also ensure I have a stress free maternity leave!
Did you spend less on your second baby than you did buying things for your first child?
Paying For Your Kids Education
I had zero financial help when it came to post secondary and I don’t blame my mom at all. Our children didn’t ask to be born so it is our responsibility as parents to provide for them and make sure their needs are taken care of, as far as I am concerned, it is not the responsibility of the parent to pay for post secondary education. However, if you’re in a financial situation that allows it, you may want to help.
We are currently setting aside a little bit of money each month for our daughter because we’re able to. My mom, though she had a good job, was a single parent and many other financial responsibilities. Though we are setting aside a bit of money for her (including any financial gifts she may get) I will not jeopardize my retirement or other financial goals so she can get a degree debt free.
I know of many people who have remortgaged their house, taken out of their own retirement funds just to ensure their kids have no debt when they graduate. This is crazy to me. Kids who go into post secondary ideally will get a job that allows them to repay any debt they borrowed. Though it will take another three and half years for us to be debt free we are 100% doing it on our own and I have zero resentment to my mom for not helping me. I chose to further my education and opted to do two degrees, not her. At 18 I was making my own decisions.
If you do want to contribute to your kids education, start early. We opened an account for her before she was three months old and continue to contribute monthly. We made it quite clear that, especially when she is young, we didn’t need many gifts for her. We would rather have the money for her savings than another teddy bear. This helps beef up her savings and limiting the clutter in our home! Double win.
It is my hope that like both me and her father, come 16 our daughter will be able to balance a part-time job, school and extracurricular activities (though if she can’t job is first thing to go). It is important that we teach her the importance of saving and plan to match any savings she comes up with on her own (to a max we will decide when the time comes). I think this will encourage good saving behaviour, which hopefully will last a lifetime and allow us to reward her for a good behaviour. Saving money isn’t easy and I’m hopeful this will encourage her.
Though I have no intentions of giving up anything I want in my life her post secondary savings (I would gladly give up anything for something she needed) you’d be surprised how easy it is to find even $25 per month. Over 18 years, while it won’t pay for a degree, it will certainly help offset some post secondary costs and your child will appreciate it!
Do you save for your kids post secondary? Will you pay for all of it no matter what?
Are Your Children Ready to Handle Adult Finances?
Now is the time that high school seniors take their college entrance exams and send out their application packages to the colleges of their choice. In so many ways, these kids are on the brink of adulthood. Yet, because very few high schools now have personal finance classes, many of these students are not ready to handle their own finances. However, in just one short year, they’ll be in college and financially independent.
Before your child leaves the nest, make sure you cover the personal finance basics with him or her.
Have the Student Loan Chat
Many students see the price tag for college and then see the financial aid package. If they get approved for enough loans, they think they’re okay and they can afford the particular college of their choice even though they’ll be buried in student loan debt.
Make sure that your child understands the repercussions or student loan debt completely. Show her how much she will be paying over the life of the loan. Let her know what her monthly payment will be and how much of that monthly payment will be interest alone. Show her how much she will likely take home from her job and how much of her salary those loans will eat into.
Teach Him to Save for Retirement
The earlier your child can save for retirement, the better. Again, give him hard numbers and show how much his money will grow the sooner he begins investing. Even investing 10 years earlier can make a big difference in the amount of money he has for retirement. In addition, show him some resources such as reading up on retirement on Suncorp’s website.
Teach Him to Live Like a Pauper in College
Sure, living in the best apartment on campus, hitting the bars and restaurants every night and taking great spring break trips are fun, but they’re also likely the activities that will land your child in deep credit card debt. Teach her to live like a pauper in college so she can begin her career and her adult life unencumbered by debt repayments.
Just Say No to Debt
This point links in with point three. The earlier you can teach your child the he can only afford what he can pay cash for, the better. If he can stay out of credit card debt as well as substantial student loan debt while in college, he’ll have greater freedom when he graduates. If he wants to take a job for a year or two working for a non-profit or joining the Peace Corp, he’ll have a much smoother path if he doesn’t have debt weighing him down.
Ideally, your child has learned many of these lessons, but if not, don’t despair. Many American teens haven’t yet learned these. Just make sure to teach them to your child before she heads off to college, a place where she can make–or break–her financial future.
How do you help your children become ready to handle adult finances?
Raising a Saver
Growing up, I didn’t have much in terms of financial role models. My mom used to say blanket statements like ”debt is bad” and ”always pay your credit card balance in full” but she never explained details about money. Details about how to manage my money, how to allocate savings or even encouraging me to save. I think she was just relieved that when I got a job she was no longer on the hook to ‘support’ me and my social habits.
My History
I grew up always spending any money earned. I managed to save a few bucks for my wedding but that was the extent of my savings. Even though I started working when I was 15, it wasn’t until I was in my mid 20’s that I began to understand the logic behind emergency funds and planning for a ”rainy day”. Though I had a savings account my entire life, it remained empty 99% of the time.
Educating your children early on how and why one saves money is so important. When I think about how much money let pass through my fingers over the last 15 years a small piece of my soul dies.
Start Young
If you want to raise a child who understands and respects money, it is so, so, important that you start young. Giving an allowance before they start earning their own money is an easy way for children to learn the ins and outs of money management.
The allowance money should come from your budgeted monthly amount for your children. If, for example you have allocated $50 per month for ”kids” which can include anything from haircuts to lunch money, give your child a percentage of that money for them to manage. This will be done within you guidance but have them learn about money; spending, saving and budgeting. Have them help you shop and budget for their things. This way they will understand that they only have $25 to buy pants, therefore rather than whining in the store about the why they can’t have the $50 jeans they will need to shop around.
A percentage of their allowance needs to go into savings. Teach them early about the importance of saving for things. If they really want those $50 jeans, they’re going to have to save up for them. Not everything can be purchased immediately and will require financial planning and preparation. This is applied to everything from the purple My Little Pony they want to the university education they aspire to obtain.
Saving as Your Child Grows Older
As kids get older, give them opportunity to make more money. Money that can be made beyond upholding normal household expectations (ie don’t pay them for making their bed). If they’re saving for something or would like to have extra money for something have them work for it. This will depend on the age but something like cleaning dads car for $20, helping clean the yard in preparation for winter for $30 sort of thing. The point is that kids need to understand early that money comes from hard work, and building savings, not from mom and dad’s wallet. If children grow up assuming money will just appear when they need it, they will fail.
When kids get they first real paying job it is important that a percentage of their pay goes directly into savings. This will be decided upon between kids and parents but agree on a spending and savings amount and enforce it. Saving early will establish long-term good habits.
Did you start saving young? How are you encouraging your kids to save?
4 Tips for Saving When Moving Abroad
So, moving is a tough activity! When I was a kid, I always dreamed of moving from one house to the next, of course always with the provision that I was moving to a progressively better house with each move. It never occurred to me then, and it didn’t really hit home until the past two years, that moving is a very involved job. And this becomes even more complicated when you have a very small budget to work with. Plus, if you’re considering moving aborad, you have some extra elements that you have to take into consideration.
Always Start Early
As soon as you have locked down your new house, start to pack up things in your current place. This should be started as soon as possible before the move. Of course, you will be scratching your head thinking, “‘how can this be done when obviously we will still need access to a lot of our things?” The answer is really quite simple. Pack all those things you hardly use first. Yes, you will have a lot of them. I consciously made the effort not to hoard things from my last move so I was surprised still at the amount of knickknacks I had managed to collect, some important, some not so much. So, start with those things. Then work your way to the move date slowly packing things along the way. You will, at some point, need professional movers to get your stuff overseas. If you pack things yourself, consider talking with the movers ahead of time to make sure that you do things correctly.
Clean and Dispose of Things
I always had three containers when I was packing, one for the stuff I was bringing with me, the other for the stuff I was donating, and the last for the stuff I was throwing away. And, again, I was surprised at how little I was actually considering bringing with me to my new abode. As I packed these now-few items, I always made sure to thoroughly clean them before packing them away. If you know me well, you would know that I HATE packing and unpacking and, in my college days, resorted to just stuffing things in boxes in a haste to get things packed, only to wince in pain at the effort required to unpack. This time, the ‘mature me’ packed carefully making unpacking much, much easier to do. How do you save here? Throwing thing away obviously lessened the amount of things I needed to cart from one location to the next. Donating things even turned out to be a helping hand. Cleaning things before carefully packing them away took away the need to thoroughly crush and clean things when they came out. So, not only was I able to save on cleaning implements, but also time and effort.
Remember, the less you pack, the more you save on moving costs to go overseas!
The Most Expensive is Not Always The Best
I do not know how it is in other countries but in mine, there are two kinds of movers- the pro’s and the amateur haulers. The pro’s will pack your stuff for you in nice, thick boxes, complete with addictive bubble wrap while you sit, watching them, sipping a cup of tea. They will also unpack most of your things for you when you get to your new place. Amateur haulers will physically lift your already-boxed items into a moving truck and then physically bring them down and place them where you want the item. That’s it. No thick box (you have to buy this yourself), and no bubble wrap. You can imagine how much the price difference is between the two. Now, if you have started your packing relatively early, and if you were meticulous with your packing, all you really need is the physically labor to lift things around and then get it to where you’re going. So, do not feel bad if you can only afford the cheapest truck. The point is getting yourself, and your belongings, from point old to point new.
Plan For When You Get There
When you move, you always end up needing to buy new things when you move in. You need to plan ahead, and make sure that you open an offshore bank account. Before you leave home, make sure that you transfer a nice sum of money to your new offshore account, and confirm that it arrived. That way, when you get to your final destination, you have cash available to purchase the new items that you’ll need for your home. Plus, having a bank account in the country you’re going can make it easier to get a cell phone and setup utilities at your new home. Do not forget that moving your money from your home country to your destination can be quite costly. As an alternative, you can use currency services for your international money transfers. Read this expat blog on this topic to learn more.
I found that if you follow these basic things, you will be able to save on so many things. You will keep to a small budget, you will save time and energy, and you will not stress out.
What is moving like in your corner of the world?