Ask an Advisor: As parents of young children at 43, what steps should we take to secure their financial future and plan for our retirement?

Ask an Advisor: As parents of young children at 43, what steps should we take to secure their financial future and plan for our retirement?

Securing your children’s financial future while planning for your retirement requires an exhaustive balancing act. I get it as a father myself. Here are my recommendations and what works for my family. This is generalized and not personalized to your unique situation and goals. Yet, it will serve as an excellent starting point.

At 43, what takes priority in your financial life, saving for retirement or securing your kid’s future?

You! To secure your kid(s) financial future, you first need to secure your own. Think of the oxygen mask on an airplane situation. You will only be useful if you secure your mask. This applies to financial planning in most situations as well.

For example, you should be saving enough to secure your retirement needs before saving for a child’s college. 

Also, keep in mind that there aren’t retirement loans, but there are student loans. While some parents struggle to put their needs before their children, I want you to know that if you don’t adequately prepare for retirement, you will financially burden your kid(s).

Steps to take to secure your retirement in your 40s:

1. Define Retirement Goals: Determine your desired lifestyle and financial needs in retirement.
2. Calculate Retirement Expenses: Estimate your retirement expenses, including inflation and healthcare costs.
3. Retirement Contributions: Contribute as much as possible to retirement accounts like 401(k)s and IRAs.
4. Create Retirement Income Strategy: Develop a plan to generate income from retirement accounts, Social Security, etc.
5. Optimize Social Security: Understand when to claim Social Security benefits for maximum payouts.
6. Tax Planning: Develop tax-efficient withdrawal strategies.
7. Regular Review: Periodically review and adjust your retirement plan to adapt to changing circumstances.

I’ve secured my retirement savings. What should I do about saving for college?

Learn what type of account to save in; some come with awesome tax benefits. Here’s a resource if you want to know more about college savings plans. Then you want to figure out how much future tuition costs will be and then figure out what that translates into monthly savings.

If you are 43 and have young children, how do you secure their financial future?

The first step plays off what we talked about above. Which is securing your financial future first and benefiting your children. You need to have enough emergency money to protect your family in case of job loss, medical emergencies, car repairs, etc.

Did you know research shows parents who have debt can negatively impact their children? How Debt Creates Unexpected Side Effects for Children

Here are a few other tips to secure your child(‘s) future that don’t involve money but are more through behavior learning and creating money smarts.

Side Hustle Together: Turn a hobby or passion project into a family side hustle. Whether selling homemade crafts online or starting a small garden to sell produce, it’s a great way to teach entrepreneurship and earn extra cash.

Financial Games Night: Make learning about money a game night activity. There are plenty of board games and online resources that teach financial literacy in a fun way. (Monopoly, Life)

Shop Smart as a Family: Involve your kids in budget-friendly shopping trips. Teach them to comparison shop or look for deals. It’s a valuable life skill that’ll stick with them.

Invest in Experiences: Instead of solely focusing on material things, prioritize investing in experiences together as a family. Whether it’s a camping trip, a cooking class, or a visit to a museum, these memories are priceless.

Educate Yourself: Financial Planning For Young Families: Three Areas To Focus On

By following these steps and staying disciplined in your financial planning, you can help secure your children’s future while ensuring a comfortable retirement for yourselves. Consider consulting with a financial planner to develop a personalized strategy tailored to your specific needs and goals. At BlackBird Finance we specialize in helping families figure out the optimum financial route and give clarity to all financial questions. Find out more here: https://bbfinance.co.

About the Author

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