Having kids late?

In today challenging environment, where many are busy climbing the career ladder while some are struggling supporting themselves due to the high cost of living. It is very common nowadays where couple getting married at a later age and only having children in their mid-30s. Usually having children becomes less of a priority. Majority are facing resources strained from having to juggle between their children education costs and retirement plans. How then you should balance this commitments? Here are some tips to keep you ahead.

So how much exactly that we need for both? 

It is crucial to know exactly how much you goals are. Sit down and discuss with your spouse. Here are some question to ponder upon? Where do you want to sent your children to their tertiary education? How do you want your retirement lifestyles? How about family expenses?  Are your spouse will continue working after having children? If there are many needs and resources limitation who and what is going to compromise?

f you have not been saving, you probably have to make up for the lost time by saving larger amount compare to others. For example if you have your child when you are 36, bear in mind that when he or she heads off to college, you will be 54, which is very close to your official retirement age.So you need to be very specific of the amount that you wanted to save. Break it down into a smaller portions to have a better idea of how much you need to save or invest on monthly basis. Another factor to consider is the inflation rate, if you unsure of how it will erode your purchasing power consult your Financial Consultant for a more accurate & details planning.

Retirement ? or Children Education? 

Although both are important and most likely both will due almost at the same time. We advice that retirement fund is the priority as Employees Provident Fund might not be enough and in a worst case scenario the children always can study locally which are relatively cheaper then overseas. Further more, there are many corporation that offered education funds aid and they always can pay back after they graduate.

How about estate planning?

There might be instances where you and your spouse might pass on before your children reaches adulthood. So it is important to appoint a guardian, usually it is better to have same set of guardians in their wills. Take note on the children’s monthly maintenance, education and medical expenses until a certain age, after that the balance can be distributed to them in installments or lump sum.

How much to save or invest?

The key is to stay focused and be disciplined. Put aside 40% of your gross income, this should include the EPF contribution of 11% and additional of 10%for insurance and retirements with additional of 10% for children education. However if you have not start saving then the amount putting aside will be relatively higher as you have shorter time.

What is the foundation?

Insurance is important as the tool to transfer risk. It is important to cover yourself adequately but affordably. Insurance will provide the fund to the family’s living expenses and children education fund if any unforeseen happened to you. Any balance should be used for investment and contingency saving.

All days are not same. Save for a rainy day. When you don’t work, savings will work for you.~ M.K. Soni

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