If you’re making more money than you imagined, or you’re both out of work, you’re still probably wondering how you will afford the things you want for your baby. While food and clothes (and diapers) are essential, we all have dreams for our little ones that can include anything from a cozy nursery to private school. Dads aren’t the only ones worrying about how to support his family. When we have a baby, we’re ready to drop almost everything just to provide for them. We want them to have everything we had, and more. How are you going to pay for it??
Getting pregnant can up the ante on fears like this. Especially in economic times like these, most of us are concerned about our financial situations. But there is nothing like getting ready to bring your child into the world to fill you with some pretty serious financial fears. So what is it that you think you need?
If you’re like most of us, you probably don’t have all the money you need to make every dream a reality. So you worry about it – maybe every time you go to the bank; maybe with every paycheck (or lack thereof); maybe every time you pay your rent / mortgage; maybe every morning when you wake up.
We usually let our lifestyles match our finances, instead of the other way around. This means that if you were able to make the amount of money you ideally want to make, you would probably find more things you want for your baby. So no matter how much money you have, you’ll always wish for something you can’t afford. And this leaves us with the almost unattainable ideal for living with life: to want what you have, instead of having what you want.
But what if you’re reading this thinking, “We don’t have enough money to live, let alone buy toys and pay for school!” It will all work out. If need be, you sell everything and move in with your parents. They’d probably never be so happy to have you move back home as when you’re bringing their adorable grandchild to stay with them.
And if all else fails, stand by the freeway off ramp and offer people photos with your exquisite baby for five-bucks a pop.
College is expensive. Though in-state schools can run as “little” as $9,000 a year according to the College Board, the average tuition at a private college or university easily tops $35,000. And while scholarships and financial aid can offset the cost of a college degree, the average debt load carried by recent college grads exceeds $20,000. Being so deep in debt is hardly a good position to start off one’s career. Many new parents are often daunted by the expenses related to raising their child; saving for college may become a secondary priority.
Here are three easy ways to start saving for your baby now—even before he or she is born—that will be easy on your wallet while still producing a nice chunk of change over time.
Upromise has partnered with hundreds of retailers and product manufacturers in its percentage-back program. For your purchase of products enrolled as Upromise partners, 1-25% of the purchase price is set aside in an education account for your child.Every time you shop online—for books, music, movies, car rentals and other travel-related services, clothing, and dozens of other items—you earn money if you make sure you have Upromise’s Turbo Saver tool bar installed. Upromise also has restaurant and retail partners—Exxon, Publix, and many more, who particpate in the program and offer percent-back options, too.You can set your account up before your baby is even born. But perhaps the very best feature of Upromise is the fact that you can have friends and family help earn, too. If they enroll in Upromise, their purchases divert percentage points into your child’s account.
They are overseen by states, and each of the 50 states has at least one 529 option available to its residents. Though the terms of the plan (and their associated tax benefits) vary from state to state, a 529 is an ideal and easy way to start saving money for your child’s education even before he or she is born. Setting up a 529 plan is typically fast and hassle-free, and you can let family and friends know that the account is available for gift-giving. A contribution to the 529 may be tax-deductible (again, depending on your state’s regulations), so family and friends may be more inclined to give a gift to your child’s 529 than a collection of baby bibs or the like. Generally speaking, the minimum deposit for establishing an account is very low. Also, if you’ve also set up a Upromise account—and since it’s free, why not?– your Upromise account can be linked directly to your 529, with Upromise earnings sent directly to your 529.
First is a direct savings plan, which you can open as soon as your child is born and has a Social Security number. You can set up automatic withdrawals from your own checking or savings account on a weekly or monthly basis in any amount: even just $20.00. ING Direct also offers two investment plan for children, one called a Custodial Plan and the other an Educational Savings account. Regardless of the plan you choose, there’s no start-up minimum, no account balance minimum that has to be maintained, and no account inactivity fees. According to the bank’s own data, if you were to invest $100 a month at the rate of 8% return on investment, the account would be worth $33,441 in just 15 years and $56,923 in 20 years. At about $25 a week, that’s not too shabby. Takes care of at least a year of college!