At some point, we all have to start taking our financial futures seriously. Your adult life is going to feature many big, scary expenses, and planning for them is the only way to make them less intimidating. The first step is to familiarize yourself with what you can expect to encounter throughout your life. Only then can you begin to understand the best ways to both minimize and prepare for them. 

Getting A Pet

According to The Simple Dollar, the initial cost of getting a pet averages $680, while year-to-year costs are about $300-$400. Even if you can easily afford this, the cost of emergency medical care can be debilitating, sometimes upwards of $5,000. Setting aside a savings account to deal with this eventuality while your pet is still young and healthy will make things easier once they are older and more likely to need care. You can also look to pet insurance to ease some of the financial burden.

Having Your First Child

It costs around $1,200 to raise a child for the first year of their lives. For most people, this is a huge part of their income, especially if a parent has to leave work to care for a newborn. The biggest costs are items diapers, wipes, gear and food, though you can save a lot of money by shopping second-hand and making your own baby food. It’s a good idea to review your family budget and see where you can make changes before the baby comes. It’s also wise to start saving as soon as you know baby’s due date. The more you put away, the more you’ll be covered if you have unpaid parental leave. 

College

Sending a child off to college is a moment of great pride, but it can also be a source of stress given the huge cost. The Motley Fool recommends setting aside a monthly sum from the moment your child is born. They also suggest looking into specific account types, such as a tax-deferred 529 plan, a Roth IRA, or municipal bonds, which will yield far more than a standard savings account. 

Buying A House

This is perhaps the most obvious one – everyone knows that some financial planning is needed if they intend to take out a mortgage. What most people don’t realize is that there’s plenty you can do to set yourself up to easily afford a home, even if you’re a while away from being able to afford that down payment. You can prepare your finances by reducing your debt, cutting down on borrowing, and optimizing your credit score. 

Major Home Repairs

The true cost of your home isn’t just limited to mortgage payments and homeowners insurance. Every house requires a certain amount of upkeep, and neglecting it will only make costs escalate further. Minimize the expense of home repairs by tackling them right away and carrying out routine maintenance tasks throughout the year. 

Unexpected Death

No one wants to think about what might happen if they or their spouse dies, but it’s essential to cover this contingency. If you have children or other dependents, life insurance can keep them safe and secure in case of your death. These days, it’s easy to quickly compare rates online – it may even be less expensive than you imagine. You should also have your estate documents in order, including a last will and testament and power of attorney as well as a plan for guardianship of minor children. 

Retirement

Planning for retirement can be a complicated affair, even if you have an employer-sponsored savings account. Before you start putting your financial plan into place, make sure you fully understand your options. Do your research on the difference between a 401(k), traditional IRA, and Roth IRA – this guide by NerdWallet has an extensive breakdown of how it all works, all translated into plain English. 

End-Of-Life

Medical costs in the last five years of life average $39,000 for individuals. That’s including Medicare coverage and excluding long-term illnesses like Alzheimer’s. One big way to control the costs is to make your medical preferences binding in an advance directive, which means hospitals can’t charge you for expensive treatments you don’t want. 

Of course, you don’t have to plan for all of these scenarios at the same time. If you’re in your early 30s, it’s normal to prioritize childcare or your mortgage. However, keeping a long-term sense of perspective is crucial for good financial planning. You want to be thinking 10, 20, even 50 years ahead if you want your savings and budget to cover all the big expenses in your life.

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Financial life planning covers a wide array of topics from daily decisions regarding money, to setting your child up for a secure future, to retirement and estate planning. While looking at the long term is critical, some people lose track of the important day-to-day pieces that are essential to financial security.

Following a monthly budget is essential to long-term financial security

The Business Insider reveals that many people don’t use a monthly budget and a large percentage of Americans regularly carry credit card debt. In terms of financial health and life planning, changing these habits can have a significant impact on your family’s long-term financial security. Budgets can feel cumbersome to set up initially, but they can be key for staying on track with spending and keeping you aware of frivolous expenditures. 

Life is busy and chaotic for most people these days, and sometimes financial basics fall to the wayside. It can be easy to lose track of how much money you have in your wallet or even a safe at home, or even lose track of a check or two in your checkbook. However, when you are trying to carefully track your spending habits and plan your family’s financial future, every dollar and detail counts.

Track your spending and cut out unnecessary purchases

Better Money Habits suggests relying on the basics to keep your spending in check. Many experts recommend relying on cash for purchases rather than credit cards or even debit cards, and if you do use credit, strive to pay those bills off immediately. When you are heading out to shop, especially for groceries, use a detailed list so you avoid impulse buys and can stick to your budget.

Tracking your spending and sticking to a budget will help you keep track of where your money is going. In addition, it will show you where you can cut back or start saving to secure your family’s future. It will also help you stay alert when it comes to fraud issues.

Be aware of fraud issues and report issues immediately

Fraud has become a concern for many people these days. CNN details that it is essential to closely track your bank account and credit card activity to watch for unexpected expenditures. If you notice something that seems off, contact your bank or card holder immediately to put a stop to unauthorized spending.

Whether you decide to use financial software on your computer, a simple written spreadsheet, or an app you can use on your smartphone, Investopedia recommends looking at your budget at least monthly so you can make adjustments as needed. Create a plan for keeping bills organized and make sure you are watching for ones that may fall through the cracks with a missed statement in the mail or similar glitch.

Kristie Sawicki of Saving Dollars and Sense shared via AOL that it is wise to review your spending every week or month to see where you can eliminate unnecessary expenditures. Don’t be afraid to negotiate rates or packages with credit card, cell phone, or cable companies and be vigilant in taking the money you save and using it to pay off debt or save for your future.

Saving for the future can feel like an abstract process, but the money decisions you make daily can have a significant impact on your financial stability down the road. The sooner you take charge of your daily spending, the more you will be able to start saving for retirement or a child’s college education. By budgeting and paying close attention to your daily spending, you are setting the stage for greater financial security for your family down the road. 

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Are you ready for the next step in your career? Before you make the switch to a higher-paying job, make sure you’ve crunched the numbers. While a higher salary is usually a better deal, it’s not a guarantee. Here are seven hidden expenses that could make or break your pay bump.

One-Time Expenses

One-time career change expenses won’t bankrupt you, but they could throw a wrench in your budget. Plan for these costs before handing your resignation to the boss.

Payday delays

Payroll schedules vary from company to company. For employees switching jobs, that could mean a long wait before the first paycheck at a new company. Ensure you have enough funds to cover bills in the meantime by buffering your cash cushion before leaving a job.

Relocation

If you have to move for a new job, negotiating a great relocation package is your best option. However, if your new company won’t pay relocation or requires you to file for reimbursement, you’ll need to come up with the cash yourself. Shop around for moving companies and downsize your possessions before the move to shrink moving costs.

Wardrobe updates

If switching from business casual to a business formal office, you’ll need to refresh your wardrobe with new pieces. Quality clothes that fit well aren’t cheap, but you can save money by creating a capsule wardrobe and tailoring your purchases. Instead of looking for the perfect fit off the rack, shop sales and hunt for promo codes to popular retailers like New York and Company, then have pieces tailored to achieve an impeccable fit.

Ongoing Expenses

One-time costs are what come to mind when most people think about changing jobs, but that’s not where the biggest expenses are hidden. Depending on how the location and compensation package compare to your old position, a new job’s higher salary might not be that good.

Commuting

The price of a long commute is more than the cost of filling your gas tank. If your new job requires a longer commute, it could hurt your wallet and your mental health. In addition to increased fuel, vehicle maintenance, and parking costs, there’s also opportunity cost and the stress of a long commute. Carpooling and public transportation help you manage the financial side, but a smaller home closer to work may be the better choice for your mental well-being.

Cost of living

Leaving an $85,000 job in the suburbs for a $110,000 job in the city sounds like a great deal until you consider that the cost-of-living increase is greater than the pay bump. Before you accept an offer, use a cost-of-living calculator to compare how far your dollar goes in each location. If the pay increase isn’t enough to justify the move, negotiate or keep looking.

Health insurance

The quality of health insurance plans vary widely, and your share of the premium payment is only part of the picture. Check how the new company’s health insurance policy compares in terms of deductibles, networks, covered services, and price of dependent coverage. If it’s lackluster compared to your old policy, negotiate for a higher salary.

Retirement plans

After salary, the retirement plan is the most important aspect of your compensation package. A good 401(k) offers a generous employer match, immediate eligibility with a short or nonexistent vesting period, and low or no fees. To assess a company’s 401(k) plan, ask these questions during salary negotiations.

Money isn’t everything, even when it comes to your job. Factors like cultural fit and upward mobility can be just as important, if not more important, than the numbers on your paycheck. However, that doesn’t mean you can afford to ignore the financial side of a career change! By taking these seven expenses into account, you can chase your professional goals and keep your finances on track.

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