Here’s a financial checklist if you have just embraced parenting

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Congratulations on your new role as a parent! We are aware that the sensation is indescribable. You’ve entered a new and exciting chapter of your life, and you’d also be feeling the weight of responsibility, as this is perhaps the most significant one you’ve ever had.  By taking a few minor but critical measures, you can ensure that the financial component of this obligation is handled correctly. Here is a concise list that all new parents should adhere to:

Boost your savings

While this may seem trivial, it is the first critical step. You’re going to notice an increase in spending in the near future, and possibly more later. It would be prudent to boost your savings now to accommodate them. Additionally, it would be prudent to review and increase your emergency savings. A job loss or a medical problem can be distressing at this point. Be prudent and prepared.

Budget for higher expenses

Healthcare costs are projected to rise in the coming years, and enrolling your children in your family’s health insurance plan is wise. You will be visiting the doctor frequently enough for your baby’s vaccinations. Additionally, set aside a percentage of your savings for healthcare bills regularly. Unless your insurance covers it, your expenses might soon escalate.

Importance of insurance

While life is inherently uncertain, you may take precautions to ensure that this does not have an adverse effect on your family by buying insurance. Term insurance is relatively inexpensive to get and can provide significant peace of mind and more so during pandemic times. The importance of health insurance cannot be undermined as well, as it will save you a lot of money from medical expenses in case of unfortunate events.

Start SIPs

To save for your child’s college tuition, invest in a portfolio of high-quality equity mutual funds. Given the numerous financial obligations, you are likely to incur at this point, investing in systematic investment plans (SIPs) can be of a significant benefit due to its power of compounding feature.

Additionally, evaluate whether you want to explore sending your child to an international school or for further studies abroad. This can be accomplished with relatively moderate SIP contributions.