Did you know the average family will spend over $300k raising a child?! And it seems like the price is going up on the daily…
Yep, as though parenting isn’t hard ENOUGH, you also have to make and manage a family budget. Don’t worry…I’m here to help. I’m Mrs. Dow Jones the Zillennial Finance Expert and I’ve got 7 tips to make 2024 your family’s richest year yet!
1. Save An Emergency Fund
Emergency funds are a financial cushion that protects you from unexpected events like job loss or accidents. They also give you the freedom to leave relationships that aren’t healthy. And they are absolutely MANDATORY to have! Seriously- ya gotta get one.
Here’s how to set one:
- Calculate how much you need. Use my free emergency fund calculator to make this easy.
- Open a high yield savings account! This is where we are going to store your Emergency Fund. Here’s the one I recommend.
- Focus on saving your first $1,000. Rome wasn’t built in a day. And your emergency fund wasn’t saved in a day either. Start smart with a small goal.
- Automate deposits to your HYSA every month until you build to that 3 month amount.
2. Be smart about housing
Housing is the biggest expense for most families. But between moving to a more affordable housing market, taking advantage of assistance programs from the government, or if you’re looking to buy…improving your credit score before you apply for a mortgage so you get a better rate- there are ways to drive those costs down! Not sure if you should rent or buy? Use my calculator.
3. Take advantage of tax cuts
The child tax credit gives you $2,000 per child as long as your child has a social security number, is under 17, has lived with you for more than half the year, and is claimed as a dependent on your returns. Don’t miss out!
4. Shop secondhand
Between Facebook Marketplace & hand me downs from friends, there’s lots of ways to get child-gear at a discount, within your family budget, or for free! Oh- and if you do have to buy something new- make sure it’s convertible in size so it can grow with them.
5. Prioritize your retirement
Many parents don’t prioritize contributing to their Roth IRAs and 401ks and instead make their children’s education or lifestyle the priority. But I am here to tell you, this is a mistake. If you don’t save for your retirement, you will get to the point where you need money and have to rely on your kids and that’s a huge burden. I promise, they would rather not go to Disney and have you been financially sufficient than meet Mickey and have to support you when you’re older. The best gift you can give your children is your financial independence! So make sure you contribute regularly to your retirement accounts even if it means spending less on lifestyle and contributing smaller amounts to your kid’s education accounts over time.
6. Plan in advance for education
It might be hard to start thinking about sending your kid to college before your kiddo even turns one but that’s the best time to do it! Compound interest is the best! Contribute (if you can afford it) to a 529 Plan, which is a tax-advantaged investment account for education costs. Also they’re super flexible and transferable within the family and you can also roll the money inside into a Roth IRA as of 2024 and you can likely get tax deductions!
7. Shop strategically
Obviously, mealtime is a big deal when you have kids. Planning in advance so that you don’t order in is a must. If you’re stressed that your kids won’t eat what you planned, well, that’s where Little Spoon comes in! And as though there aren’t enough money hacks here to go around, you can get 30% off your first Little Spoon order with code “MDJ.”
And if you want to take things up a notch, check out my free 2024 ultimate guide for growing generational wealth.
Stay rich.
