It’s no secret that children are expensive, and living costs seem to be on a constant rise. This means that it’s getting harder and harder for parents to save money for the future, while also being even more important.
But don’t worry—it isn’t impossible to save money. Here are a few tips to help you put some cash aside for rainy and sunny days ahead.
THINK OF WAYS TO CUT COSTS
The first thing you can do is make the most of what you have by getting rid of any unnecessary expenses. So, this means first working out how much money you have and where it’s all going. Look at your statements and use this to find potential places to save.
If you have any debts, this can be a huge drain on your finances. Use techniques like the snowball method, the avalanche method, or a consolidating loan to make it easier to pay off your debts more quickly.
You should also look for ways to save when you spend. Reduce any non-essential costs while trying to pay less for actual essentials. You can sometimes find amazing deals by shopping smart or looking for second-hand bargains. This can save a surprising amount of cash when you add up every little purchase you make, which can then go toward your debts or your savings account.
SAFETYNET SAVINGS
If you have debt, it’s always best to prioritise that over building your savings. The amount you pay in interest for debts is more than you will earn over time with your savings.
However, if you don’t have debts or if you are paying the maximum amount towards your debt, then it’s a great idea to save. First, we’re going to talk about general saving, rather than saving for specific purchases.
It is a good idea to save for large purchases and expenses, mainly because it means you don’t need to go into debt. But you should also have a safety net of a few months of expenses in your account. This means that, if you get a surprise expense or if you lose your job, you can survive for a while.
SAVING SCHEMES
Finally, it’s important to save for the future by putting money into savings schemes. The most common way to do this is to save for your retirement. Most people get money when they retire anyway, but by adding to your pension, you will be better off in the future, especially if you develop health problems.
Another good way to save for your family’s future is with an RESP, which is a registered education savings plan. This is designed to fund your children’s education costs when they get older. But what happens to unused RESP?
If your children don’t need the RESP, then you can put that money elsewhere to make sure that it doesn’t go to waste. This way, your family can still benefit in the long run.
