How to future-proof your family’s finances

As a parent, you want to give your child the best start in life as well as making sure their future is just as rosy. Luckily there are lots of simple ways to make your family financially secure for years to come.

Having a financial plan for your family not only gives you peace of mind, it also means you can give your child a helping hand with those milestone moments as they grow older.

From setting budgets to investing in life insurance and pensions, here are seven things you can do today to build up your family’s financial resilience.

Understand your spending

A great way to protect your family finances is by getting to grips with how much money is coming in each month and how much is going out. A quick and easy way to do this is by going through your bank statements.

Write down all your earnings and any benefits you claim, along with all your outgoings. This will help you spot any areas where you’re spending lots of money and where you can make long-term savings.

Work out your family budget

Once you’ve crunched the numbers, set yourself a weekly or monthly family budget. This will help future-proof your finances by making sure you’re not spending more each month than you’ve got coming in.

It’s also a good time to overhaul your outgoings by shopping around for utilities suppliers to get cheaper rates and cancelling any memberships or subscriptions that you’re no longer using.

Take out life insurance

It’s something we all avoid thinking about. However, if you or your partner should pass away, you’ll want to make sure your family is financially secure. Give yourself added peace of mind by taking out life insurance.

Set your family goals

It’s easier to save for your family’s future when you know what you want it to look like. So, whether it’s retiring early to help care for your grandchildren or paying for your child’s wedding, work out what your long-term goals are. This then gives you something tangible to look forward to and makes it easier to set some money aside each month.

Save for your child’s future

Want to give your child a helping hand with their finances, maybe to buy their first car or get on the property ladder? Then why not open a children’s savings account. There are lots of different options to choose from, including instant access accounts or tax-free Junior ISAs. You’d be surprised how quickly it builds up!

Pay into a pension

Another way to future-proof your family finances is by paying into a pension. It’s up to you how much you save for your retirement and which type of pension you go for.

A good tip to work out what to pay is to take your age when you start your pension and halve it. Then put this percent of your pre-tax salary into your pension every year until you retire. For example, if you start your pension when you’re 30, you’d put 15 percent of your salary aside until you finish work.

Make a will

No matter whether you’ve just had a baby or if your children are older, there’s a simple piece of financial future-proofing you can do right away: make a will.

Even though it’s probably the last thing you want to think about, it is a key part of your financial planning. Writing a will not only means you can decide who will look after your child if you pass away, it’s a way of putting financial arrangements in place for your little one when they are older.