How much money does it cost to raise a child? On average, over $200,000 until they are 18. From basic expenses and healthcare to education, bringing up a family is expensive. And this figure doesn’t even include other major expenses that may occur as they get older, such as marriage costs and university fees. If you want to be able to afford to bring up your children comfortably, it is important that you begin your financial planning when they are very young.
Children’s Life Insurance
If you have wondered, “What is child life insurance?” or “Is children’s life insurance worth it?” the key thing to know is that it can be extremely beneficial in helping to cover the cost of major life events as they get older. You pay a small fixed premium every month – this is generally the same for both boys and girls. The insurance company will then make a fixed cash payment on certain events, or when they turn 18. This lump sum can be extremely valuable when it comes to covering the cost of college expenses. You can even make the decision as your child grows older to add further coverage for major events, such as when they buy their own home or get married.
Open A Savings Account
Opening a savings account for your child is far better than putting money in a piggy bank, and you are less likely to break it open. Many banks allow children to have control of their own savings accounts from the age of 10, and you can even open an account for children younger than this. When you are looking for the right savings account, make sure that it has no ongoing maintenance fees and the highest yields that you can get, so your child is always earning interest on their savings.
A Child Investment Plan
Child investment plans give you the option to invest a monthly amount to go towards basic living expenses. If you pay more each month, you can choose an investment plan that includes health insurance or a child education plan. Many child investment plans also offer a sum to be paid if there is a parent that passes away, as well as payment for accident or disability. Some plans also offer regular annual payments to help with rising living expenses.
Raising a child costs a lot of money as they grow and their needs change. Start planning for their future as soon as you can: then you can be confident that you’ve got all the major life expenses covered.