Money; it’s what makes the world go round, right? But, it can also be the catalyst for unhappiness and worry and, being a mother, that’s the last thing you want. Stress about money can affect everything: your mental and physical health, relationships, family life, and work. However, it doesn’t always have to be like that.
Change Your Mindset
The old “woe is me” mindset will not help anyone, least of all yourself and your children. Sometimes money worries can lead to a spiral of negativity, a feature that can rub off on your children.
Self-belief, self-esteem, and self-appreciation goes out the window and with them any hope of getting through a tough time. Change what’s between your ears. Focus on earning bid and spending little.
While we’ve gone over the mental preparation, physical planning is essential too. And, what better place to start than protecting yourself. Life insurance does what it says on the tin: insure your life. Also, if you have dependents, you should have stand-alone joint life cover until your youngest completes his third level of education in case anything happens to either you or your partner.
Income protection is incredibly useful for protection when you are the only earner in the family, and it is the single insurance type to give tax relief. Win-win.
Time to Save
Sometimes emergencies come around, so keeping around three to six months’ net annual income in an accessible deposit account can help in that outcome. Remember, money in the bank can alleviate worry, and, as a mother, giving your children a safety net can do just that.
A sudden loss of income can also be mitigated by saving while there may be an investment opportunity that you cannot turn down. There is also the need to save for both the short-term and long-term. Short-term, for example, can include a holiday or car and long-term for a deposit on a house or mortgage. Open a savings account with a nickname such as “holiday 2020” or “house 2025”. That way, it gives you a goal to aim towards, knowing all that money in that account is going towards that end goal.
While touched upon under the savings bracket, investment in itself is an excellent way of taking charge of your finances. Of course, you will first have to understand how to invest your money. But, after that, with savings in the account, the world is your oyster.
The stock market has yielded the best return of all asset classes with a 10% return average in the last century, with cash savings having their value destroyed over time by inflation. But, timing is essential.
The BULL (rising) and BEAR (falling) of the stock market is imperative to understand, and the market has currently entered the second longest and 26th BULL market of all time, but the next market will be a BEAR. But who knows when that will be?
Feel confident in choosing a company, fund, and plan that will set you up for life, but do it cautiously. If successful, you and your children will always have something to fall back on.
Be Responsible With Your Money
Having kids, they are always watching – as creepy as that sounds. If they see you prioritize saving, budgeting, and investing, then they are much more likely to follow in your footsteps. However, throwing money away left, right and center will not exactly look great in the eyes of your children. Research shows that financial habits are learned from as young as seven years of age.
Involve children; children love to be involved, so creating an allowance system will let them join you on your financial journey. Set money-making goals with them and encourage them to save by not buying sweets or crisps one week, or set goals as a family. For example, try getting your electricity bills below a certain target each month.
It’s Down To You
Ultimately, taking charge of your finances comes down to you. But, all the points above are certainly classic examples of how you can own your money. And, as in everything, planning for the future is essential, whether it be for you or your children.