Money Matters: Four financial steps for new parents

Reported by: Brittany Price
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Updated: 7/30/2014 11:44 am
They certainly are cute. Lets face it though, babies are costly too. 

"The average cost of raising a child, just to get them through high school, is over $200,000," Financial Adviser, Tommy Wood, said. 

Making smart financial moves can help parents get children form diapers, to a degree. 

First: purchasing sufficient life insurance. 

"Unexpected passings do happen. While that's always a big deal, when you have children it becomes a much bigger deal," Wood said. 
"Be able to set funds aside to make sure that kids are raised." 

Second: prepare a will. 

"Not only does it direct assets for when someone passes away, it can also say who you want the guardian of your children to wind up being," Wood said.  

Third: maintain adequate cash. 

"What we don't want to wind up seeing is someone getting into their long term investment, or their goal money, in order to come up with the money they need to cover unexpected emergencies," Wood said.  

Fourth: save early and often for college. Wood said a 529 plan is a worthwhile option. 

"It allows someone to put money away in an education account. it grows tax-deferred. When the money is withdrawn, as long as it's used for qualified college expenses, it can be 100 percent tax free," Wood said.  

Wood added, while you can't put a price-tag on your child's future, strive to strike a balance. Keep your own retirement savings a priority. 
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