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My family means more to me than anything. Here are three crucial things I’ve done to protect them financially.
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I welcomed my second child this summer, and ever since, I’ve been swept up in the routine of feedings, diaper changes, and naps. It hasn’t been easy to find the time to do even basic things like cleaning the house. But it was important to me that I made room for the following three financial moves to help keep my family secure, no matter what the future holds for us.
1. We built an emergency fund
Having an emergency fund is extremely important to me because there’s no way of knowing when unexpected costs will arise. One of our appliances could break, we might need to file an insurance claim, or one of the kids might need to visit the hospital unexpectedly. Without cash on hand, we’d really be in trouble if any of those things happened, especially while I was on unpaid maternity leave.
The general rule of thumb is to keep at least three months of living expenses in a high-yield savings account, but we set aside even more to be safe. Having that money there gave me peace of mind that we’d be able to tackle anything that came up.
2. We budgeted carefully
My maternity leave made our budget a lot tighter than we were used to right as our expenses rose with the birth of our new baby. Fortunately, we’d saved extra above and beyond my emergency fund to cover our routine costs while I was off work. It still wasn’t easy to see my savings account balance shrink month after month, but having that plan in place ahead of time kept me from losing too much sleep over it.
To be extra safe, we also did what we could to keep our expenses to a minimum while I was off work. We shopped around as much as we could to make sure we got the best possible deals on essential items, and we put off non-essential purchases for a day when life is a little less hectic and money is less tight.
3. We bought life insurance
I already had life insurance prior to the birth of my second child, but I increased it to ensure my family would be adequately protected should I die unexpectedly.
Generally, you want enough life insurance to repay your debts and replace your income. Those things didn’t change just because I had a baby. But I also hope to one day be able to contribute to my children’s college education costs. My existing policy wouldn’t have been adequate to pay for both of my children’s college as well as debts and routine expenses, so I bought a little extra.
Since I’m still fairly young and healthy, it didn’t cost me too much. Rates vary depending on your age and health, but it’s often possible for adults in their 30s like me to get policies for a few hundred dollars per year. While I sincerely hope I never have to use it, I feel a lot better having it.
Being a family of four is still somewhat new and our budget is still a little in flux, so there might be more financial changes on the horizon. But I try to keep my family’s security top of mind in everything I do. Sometimes that means saving when I’d rather spend or working on budgets instead of doing something fun, but it’s all worth it in the end.
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