Top 5 financial tips for young families

Top 5 Financial Tips for Young Families

Starting your family off with a strong financial foundation is key to a life of security. While struggles with money are common, there are some simple steps you can take to make it easier for your family to get off to a good start. Here are five ways that you can help ensure your family’s financial future.

Prioritize Savings

Think of your savings account like you would any other bill and put a designated amount into it at regular intervals. You may be able to set it up so that funds are automatically withdrawn when your paycheck arrives. This is a helpful way to establish a lifelong discipline. The sooner you start saving, the bigger a nest egg you will have in place, particularly when you take interest into account.

Buy Savings Bonds

A great way to provide for your children’s future is to invest in savings bonds for your children. If you buy them once or twice a year and stick them away in a safe place, your children will have a very nice fund by the time they reach adulthood. This can be especially helpful for post-graduation travel or housing expenses.

Take on Extra Work

There are many ways of earning a little extra money, whether it’s getting a part-time job or working from home. Many stay-at-home parents have found success selling items online or doing freelance work. Having a line of income dedicated solely to savings is an excellent way to ensure an ample emergency fund.

Avoid Credit Card Debt

It can be all too easy to dig yourself into a financial hole with credit cards. While they are useful for large purchases such as furniture and cars, you should be very selective about using them. Only get one or two, and restrict their use to essential items. Don’t fall into the trap of thinking of credit as money available to you. Once interest starts kicking in, it will get harder and harder to keep up with those bills.

Take Advantage of Coupons and Sales

Finally, there is no shame in being thrifty. You can buy a lot of useful items second-hand, whether at thrift stores or garage sales, and store-brand items usually cost significantly less than name-brand equivalents. With a little preparation, you can map out your shopping trips to maximize savings, combining coupons with store promotions and sales to keep costs down as much as possible.

David Milberg is a financial investor based in NYC.

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