Life is full of many exciting landmark events which serve to bring you joy and greater fulfilment. But, whether you like it or not, money is often the deciding factor in your accomplishment of these goals, as well as how long they take you. Responsible financial planning is crucial in all areas of life. Having enough savings in the bank will help you live the happy and comfortable life you deserve. Here are the five major life events you need to plan for financially.
1. Buying your own home
Buying your own home is a major achievement that requires serious financial planning over a number of years. Most obviously, you’ll need to budget for monthly mortgage payments. Otherwise, it’s a good idea to have enough savings to cover at least six months of living expenses. This makes sure you have enough money to cover all the responsibilities that come with owning a home now you’re no longer depending on a landlord (such as, fixing broken plumbing and maintaining appliances).
2. Starting a family
Having a baby — although wonderful and life-enriching — is a long-term expense. Of course, you’ll need to financially support your child at least until the age of eighteen. It’s important you and your spouse make sure you’re financially ready for a new addition to your family. You should budget for all the daily expenses, as well as larger things, such as, life insurance and a college fund to give your child the best start to adult life.
If you and your partner are planning to get married, sit down together to discuss how much you want to spend on the big day. Once married, couples tend to merge finances, bank accounts, and debts. So, it’s important you discuss your financial goals before your wedding. Perhaps your priorities as husband and wife are launching a business, buying a home, or saving to start a family. Make sure your wedding budget fits in with your financial goals.
When it comes to planning a wedding, there are many expenses to consider and budget for. This includes everything from the outfits and rings, to transport, catering, and the venue. You’ll also need a professional photographer to capture your day in all its glory. If you’re looking for talented, professional wedding photographers in the North Carolina area, the Blue Bend Photography website is certainly worth a read.
4. Serious illness
Although no one likes to think about it much, serious illness — especially in older age — is a real possibility. If you or your partner were to become ill in the future, this could lead to one of you stopping work and a loss of income as a result. In addition, you may be faced with ongoing medical bills which take a large chunk of your finances. It’s always wise to keep a realistic outlook and prepare for potential future emergencies. Keep an emergency savings account to help you out financially in hard times — along with medical insurance. It also pays to look after your health to avoid becoming ill in the first place. Living a healthy lifestyle will help keep you physically and financially well long into the future.
It’s never too late to start saving for your retirement fund — and always best to start as early as possible. Your forties and fifties are your peak earning years money-wise and will give you ample room to significantly build on your retirement savings. As you get nearer to retirement age, consider how ready you are for it. How do you see yourself living day to day after you retire? Make sure your finances match the goals you have for retirement — or consider changing them to create a fulfilling life you can afford.
When it comes your finances, many people can feel anxious, overwhelmed, and prefer to avoid thinking about it. However, it’s important to take charge of your finances to make sure you’re better prepared for the above life events — along with any curve balls life throws at you. Don’t worry if you don’t have much money to save: do as much or as little as you can. Starting a savings fund and making small, periodic contributions will leave you better off further down the line than if you never started at all.