Having kids is stressful enough. Planning how you’re going to pay for them doesn’t need to be.
The joyous sound of your child’s first giggle. The pitter-patter of tiny feet running down the hall. The crushing existential dread of this new overwhelming financial burden.
Wait – let’s go back to that last one for a second.
For any new(ish) parent, the many life-changing joys of the little human you’re taking care of also come with a new list of responsibilities. And the financial one is huge.
Babies, to put it mildly, are not cheap. Many brand new parents struggle, understandably, just to juggle their current to-do list. So the idea of taking the time to responsibly save for the future can feel light-years away.
But to get the maximum benefit you need to start now. Right now.
There are various ways you can start investing in your child’s future today and, hopefully, give yourself a bit more peace of mind during those 4 am feedings you’re suddenly enjoying.
Open an RESP, like, yesterday.
The good news is that time is on your side. As with many types of long-term investments, a long-term outlook is your friend. Worried about saving for post-secondary schooling? Then a 17-year deadline is a good thing!
Simply put, the longer you have to save for something the more opportunity your investments - even seemingly small ones - have to securely grow. This is where a little can go a very long way.
It’s a good thing for everyone (you, your kids, the future of humanity) when you save for your child’s education. The government helps makes it easier with
The government wants to give you free money so you should take it.
When you open an RESP you want to make sure you also enroll in the
We know financial security comes and goes, but it’s key to aim to add at least $2500 to your RESP each year. As an extra incentive for you to contribute regularly, the CESG will automatically add an extra 20% (up to $500, so that’s where that annual $2500 minimum target comes in) into your RESP each year.
Keep it up and the CESG will max out at an extra $7,200 in each child’s RESP for doing, basically, nothing. Other than the whole “being a parent” thing.
Don’t let a lower family income hold you back from saving.
Parents making less money are automatically more aware of how much it can cost out-of-pocket to take care of their children. That can make thoughts of saving anything at all feel even more stressful.
There are a few ways the government might help subsidize your childcare costs if you qualify:
1 Apply for a monthly tax-free payment through the
3 An additional benefit to the CESG is the, wait for it, A-CESG. The
We know you don’t want to think about it, but you need life insurance. And a will.
We might be a little biased when it comes to the importance of insurance, but once you have a child who (at first, quite literally) depends on you for everything, you’ll want to make sure you’ve got all of your bases covered.
That means you need life insurance and a will. Sure, it can feel morbid, but you’re insuring more than just yourself now.
When it comes to choosing the size of your policy, start by planning for your family to be able to support itself for five to 10 years. If you can afford it, plan for the higher end of your budget and don’t forget to include major life expenses, like tuition, in your calculations. (Of course, this is another instance where a maxed-out RESP will come in handy no matter what.)
Once you’ve got your future life covered, create a legal will and make sure you’ve got everything you already own taken care of, too. Wills have come a long way - check out
You’re not alone. It might feel like it, but you’re not.
If there’s one thing all parents have in common it’s that life will never be the same. We’ve partnered with