John J. Bowman Jr., accountant, provides a few personal finance tips for new parents.

1. Personal
Finance Tips for
New Parents
JOHN J. BOWMAN JR., ACCOUNTANT

2. Raising a child is absurdly expensive.
According to the latest federally-provided figures, a child can cost his
or her parents an average of $233,610 over the course of eighteen years
- and that isn't even accounting for private or college tuition!
Welcoming a child into the world is an exciting time for any parent, but
it requires some practical thinking and hard financial conversations.
Here, I overview a few strategies that every single expecting or current
parent should implement to secure their own and their child's financial
future.

3. Create a New Budget
A new baby brings new expenses. The added
financial cost posed by diapers, formula, and
childcare can weigh down even a solidly made
budget. Keep track of your expenses, and build
a budget around the actual expenses you face,
rather than those you projected pre-baby.
Mind you, some of the costs you encounter
might not be ones you anticipated; make sure
that your health insurance will provide
adequate coverage for your child in the case of
emergencies. The last thing you want to
discover on a trip to a needed doctor’s
appointment is that your insurance doesn’t
extend to your baby.

4. Bolster Your
Emergency Fund
While every adult should have a sturdy
emergency fund, these tucked-away
savings are vital for new parents. After all,
losing your job when the only person you
have to worry about is yourself is one
problem. Losing your job when you need
to support a child is a problem of an
entirely different magnitude. Make sure
that you have enough in your emergency
account to cover your family’s living
expenses for three to six months in case of
disaster, and ensure your financial security
by reducing your credit card debt.

5. Set Up a College
Savings Account
It may seem odd to start saving for college
when your child is still in preschool, but
starting early is the only way to lessen the
burden of tuition. Set up a 529 college savings
account, and contribute however much you
can afford every month. Your small inputs will
add up over eighteen years; while it may not
be able to cover the full cost of college, it
should defray the overall burden and put your
child in a position to graduate with a
manageable amount of college loan debt.

6. Research Tax
Credits
Knowledge is the key to financial security.
Common tax credits include the child tax
credit, which can give you a $1000 credit
every year until your child turns
seventeen, and the child and dependent-
care credit, which provides qualifying
filers the chance to claim up to $3000 for a
single child under the age of 13. Do some
research to find out which tax credits your
child gives you eligibility for!

7. Thank
You!
JBowmanAccountant.info