The information provided on this website does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only. Information on this website may not be current. This website may contain links to other third-party websites. Such links are only for the convenience of the reader, user or browser; we do not recommend or endorse the contents of any third-party sites. Readers of this website should contact their attorney, accountant or credit counselor to obtain advice with respect to their particular situation. No reader, user, or browser of this site should act or not act on the basis of information on this site. Always seek personal legal, financial or credit advice for your relevant jurisdiction. Only your individual attorney or advisor can provide assurances that the information contained herein – and your interpretation of it – is applicable or appropriate to your particular situation. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client or fiduciary relationship between the reader, user, or browser and website owner, authors, contributors, contributing firms, or their respective employers.
Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them. Compensation is not a factor in the substantive evaluation of any product.
[Tweet “Young families looking to achieve financial stability should consider several foundational steps early on.”]
Young families looking to achieve financial stability should consider several foundational steps early on. These steps include making a plan to repay personal debts, saving up for a down payment on a house, and planning for the unexpected. To learn more about the steps young parents can take to build a financially secure future for their families, read on!
According to CNBC, the average personal debt amount hit $38,000 in 2018—accounting for things like credit cards, personal loans, and student loans. Moreover, about 40% of Americans devote half of their monthly income to repaying these debts—which prevents them from saving money for the future and achieving other financial goals like buying a home, taking a family vacation, and putting money away for the future. Unpaid debt may also lead to strain in a marriage, health complications, behavioral issues among children, and financial stress.
To build a financially secure future for your family, it’s important to start by paying off your personal debts. By making a plan to repay your debts, you’ll be on your way to saving more money for the future and conquering other financial goals such as buying a house, building an emergency fund, and saving for retirement.
If you plan on buying a home in the future, it’s important to start saving for a down payment on a house as soon as you’re able. While the length of time it’ll take to save for a down payment will depend on your household income, how much you’re setting aside each month, and whether you’ll be putting 3.5%, 10%, or 20% down, it could easily take several years to save enough money to buy a home.
As you start building a down payment fund, it’s important to learn about the different requirements you’ll need to meet when you’re ready to purchase a home. To finance a home purchase, for instance, most lenders will require a down payment of at least five%—but specific down payment requirements vary depending on your credit score and the type of loan you wish to obtain. You can finance a home purchase without a down payment in some situations, but your interest rate and monthly mortgage payment would be higher.
One could argue that just about any type of financial planning means thinking about the future, but here we’re referring to things like estate planning and purchasing life insurance. Even though you’re young and plan to be around for many years, one of your goals as a spouse and parent is probably to provide for your loved ones now and in the future—even in the event of your incapacitation or early death. As such, it’s important to create an estate plan and purchase a life insurance policy that will protect your loved ones if you can’t be around to provide for them.
Typically, you’ll want your estate plan to cover the following:
Estate planning can be an unpleasant task at any age, but a good estate planner can take some of the agony out of this process. To find a good estate planner to assist you, be sure to obtain recommendations from trusted friends and family members, and look for attorneys that specialize in estate planning.
By taking these three steps while your family is still young, you’ll be one step closer to conquering long-term goals like paying off personal debt, saving for a down payment on a home, and making sure that your family will be well cared for in the event of your incapacitation or early death. Any long-term financial goal takes time, planning, and dedication, but these tips will help you to get the ball rolling.
March 11, 2021
Personal Finance
March 1, 2021
Personal Finance
February 18, 2021
Personal Finance