This is a partnered post.
You may or may not have received the best from your parents, but you want to provide a better life for your children. Most parents can’t help but wonder what will happen to their children if they die. This article will look at five smart steps that parents can take to provide for their children’s future in the occurrence of an unforeseen event, such as the death of one parent or both.
1. Invest in Stocks
The most familiar type of stock investment is purchasing company shares. Shares grow over time as the company grows to enable you to sell them at a profit in the future. Since you are buying the shares for your children, you will be receiving dividends in the meantime, as most companies pay dividends to shareholders. This can also be an alternative source of income for you, especially in retirement. Another benefit of buying shares is that they can be purchased and disposed of more easily and quickly than other investments such as art or real estate. You can quickly sell them if you have an emergency that requires instant cash.
For instance, if you want to know about your AMD Earnings, you can follow your stocks’ progress at marketbeat.com to establish if you need to sell your shares or buy more. Stocks will continue earning dividends even if you are not around to check on them. If you want your children to benefit from this, you can inform them and also put them as next of kin on your shareholdings. With such investment, your children will not miss out on anything as all are known and they will benefit.
2. Open a College Savings Account
Opening a savings account to cater to your child’s college education is a smart move. You should start saving as early as you can to ensure that you have enough money when the child gets to college. There are state-sponsored accounts that allow investing after-tax earnings tax-free. Employers even enable their workers to directly send the money out of your paycheck automatically into the account. This will reduce the worry of the future.
When you have this account, you are sure that your children will get an education in the future. The account allows you to save in small bits. At the end of it, you will find that it has accumulated and you can easily pay for your child’s college expenses. The future is unknown. You may not be in a position to pay that huge amount of cash, but with this, it will be a smooth path. Do your research to find out about available options in your state and the limited amount you can contribute per month.
3. Teach Them to Budget
Teaching your children the concept of budgeting is one of the important life skills you can ever undertake. Irrespective of how small their allowance, teach them to keep track of their spending by planning how to spend the allowance. This will enable them to manage money in the future better when they start to earn. As a parent, you have to be cautious of the future and the life of your child depends on how you train them. If your child can master the habit of budgeting then he or she will be safe in the future in terms of finances.
4. Get Life Insurance
Many people are aware of the benefits of life insurance but are afraid to sign up. Some think taking life insurance is like willing themselves to die. One advantage of a life insurance policy is that it caters to your funeral expenses. Proceeds from the policy will also help your children go on with life without hardships as they will continue to live more or less the way they were used to before your death. A life insurance policy makes life bearable for the family left behind.
5. Plan for Long-Term Care
Most people forget that they will grow old where they will require care. An aging parent with chronic illness becomes a burden to their family as they need specialized care which is often costly. You can start saving for your retirement early on when you are still young and working to avoid placing the burden of taking care of an elderly parent on your children.