May 29, 2009
People often say mothers have the hardest job in the world – and I wouldn't dispute that. But being a father might be the second hardest job in the world. And becoming a dad for the first time is a challenge for all men.
Putting aside the physical and emotional rigors of fatherhood, the financial implications of having a child are staggering.
According to the USDA, the average cost for a middle-income family to raise a child until age 18 is over $200,000 – and that doesn't even include college. Small wonder, then, that nearly 40 percent of Americans surveyed by Visa Inc. said they weren't prepared financially for the birth of their first child.
As one dad to another, let me share a few financial planning strategies that can help map out a strong financial future for your family:
Get insured. Although young, single adults often go underinsured, if your family depends on your income, you shouldn't be unprepared for life's unexpected events. Buy adequate coverage for:
Start saving now. It's ironic: When you're young and can least afford it, that's when you can make the most lasting impact on your financial future. The earlier you start saving and "compounding" or reinvesting the interest earned, the faster your savings will grow. That's true whether you're saving to buy a house, pay for retirement or send your kids to college.
One tip: If your employer offers 401(k) matching contributions, contribute at least enough to take full advantage of the match: A 50 percent match is the same as earning 50 percent interest on savings.
And finally, spend responsibly. If you buy things you don't really need or can't afford, you'll just end up having to work longer hours to pay for them. That's unrecoverable time you could have spent watching your kids grow.
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