New parents soon learn that the pitter-patter of little feet is quickly followed by the thunderous entrance of new expenses. In the midst of the excitement and celebration over a new baby, there need to be thoughtful discussions about how to plan for everything from diapers to diplomas. Talking about your goals with your family, including your own financial dreams, can help everyone align on the financial strategies for the new arrival.
How parents can TALK about finances when expecting a baby.
Think ahead. Conversations about money with family can be sensitive. When you talk with family members who are having a baby, choose a time and place that allow you to clearly communicate your thoughts and listen to their ideas. Start with the assurance that your intent is to help them realize their lifelong dreams. Explain how you have your own dreams for the future, and share their desire to successfully provide for your extended family financially. By expressing desires and concerns openly, you can begin to help each other get to where you want to be.
Ask good questions. When you sit down together, here are some questions to help start the conversation to gain understanding and uncover areas that need attention.
> How will you and your spouse address financial planning for your child?
(education, savings, child care, special needs)
> What can you do to make sure your child is always financially secure?
(insurance, guardianship, support from other family members)
> How will you prioritize your future goals with a new family member?
(education, housing, retirement, life dreams)
> How current and complete is your budget?
(Income and expenses, savings for the future and emergencies)
> How will you teach your child about financial responsibility?
(allowance, budgeting, savings, charity, limiting gifts)
Listen first. Listen closely to the answers, write them down and see how you can help your family member understand how your goals and actions are connected with theirs.
Keep the conversation going. Once you’ve opened the door, keep it open by setting mutual goals and tracking progress regularly. This is a time of big changes — report back to each other as financial situations and objectives change.
Your financial advisor can work with you to plan your family financial goals using our unique and collaborative Dream > Plan > Track >® approach to financial planning. Keep the lines of communication open and work together toward a successful future.