Costs that parents didn't see coming
(NC) Raising a child is full of surprises, including unexpected expenses. Recent research by TD Canada Trust found the top five costs parents say they didn't prepare for are sports and extracurricular programs (30%), education (27%), vacations and/or summer camps (19%), child care (19%) and clothing, toys and games (14%).
“Start saving early, and regularly, even if the amounts are small to start,” said Janice Farrell Jones, Vice President, TD Canada Trust. “While unanticipated costs may creep up on parents, they can be easier to manage when good savings habits are practiced and a financial plan is in place.”
Farrell Jones provides three tips to help parents plan ahead for the costs of their little bundle of joy.
Plan now and for the future: Create a financial plan that includes both immediate costs and expenses for one year, five years and even 10 or 15 years down the road. Be thorough and account for things like extracurricular activities and summer camps to help prepare for future expenses.
Follow a budget: It can be easy to overspend when it comes to kids, so create a realistic budget and monitor spending to keep on track. There are lots of online budgeting tools that can help get the process started, TD Canada Trust has budgeting tools and resources at tdcanadatrust.com.
Make saving routine: Set up an automatic transfer of a set amount into a savings account, like a Tax-Free Savings Account. Not only can it help create a fund for kids' activities, but it can also act as a cushion so surprise expenses aren't a big shock to family finances.
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