Our Financial Tips for Meghan and Harry
Last Monday, May 6th, Meghan Markle and Prince Harry had their first child, Archie Harrison Mountbatten-Windsor. As the royal couple settles into new routines with Archie, Guardian Savings wanted to share our tips on the steps you can take now to ensure your new child is financial secure and has a strong understanding of financial concepts.
30 to 60 day plan
Add your child to your health insurance plan within the first 30 days. During pregnancy make sure to review what will be covered by your insurance and what to expect in out of pocket costs. If one parent is planning on staying home with the child, make sure that both the baby and new stay-at-home parent are covered under the working parent’s insurance.
Set up life insurance for your child. You never want to think about the worst case scenario but just as you would invest in life insurance for yourself and your partner it’s a good idea to protect your child in this way too.
Do the necessary legal paperwork. Should anything happen to you and your partner you should designate a guardian for your child in your will. You also may want to adjust the beneficiaries of your 401(k) and IRAs to your child.
Within the first year
Start saving for college. Contributing to a 529 college saving plan a great way to start preparing for your child’s future. Work with your partner to determine a savings plan that works for you and still allows your you to contribute to your retirement. While you should prioritize your retirement savings, this is a great way to set your child up for future success.
Suggest that family and friends think long term when giving baby gifts. According to CNBC, gifting a baby stocks is a great way to start a conversation about money and investing from an early age. Steve Siebold, author of How Rich People Think has said of a childhood gift of stocks, “It was fun to watch the stock make money, but more importantly it taught me some very valuable lessons about money. I learned all about the stock market, investing and making money from an early age, and without that gift I never would have learned any of this so young in life.”
Review your emergency savings. Make the necessary adjustments to your emergency savings fund to account for increased expenses for your growing family.
Start talking about finances. As your child gets older you can begin talking to him or her about finances. One of the best ways to do this is by involving your child in smaller financial decisions like grocery shopping or deciding whether or not to eat out.
Open a savings account for your child. Building an early familiarity with banks and their function in our day-to-day life can give your child more confidence in dealing with money in the future. Guardian Savings can assist in this educational journey through our app, which functions as a ledger and digital piggy bank.
Give your child an allowance. Giving your child an allowance will build up his or her familiarity with money and help them learn key financial concepts. You can even encourage your child’s entrepreneurial spirit by helping them brainstorm new chores or jobs that would earn them more money, like washing the car, cleaning out the garage or being a mother’s helper.