No matter how much money you make, it pays to keep on top of money coming in and going out. Even if you do a
good job of that, there are important times in your life when talking with a professional adviser makes sense.
Almost every major life event – finding or losing a job, getting married or divorced, having a baby, buying a home –
– is likely to have a major impact on your finances. A new job may mean you are making more money — no problem
there as long as you know the best way to invest it. Getting married may mean you have a second income to count
on, but now you have someone counting on yours as well. Buying a house means you have to come up with a hefty
sum of cash for a down payment, get used to monthly mortgage payments and meet the expense of house repairs.
Let’s look at what happens if a baby comes into your financial picture. First, medical bills need to be paid, so having
good medical insurance is important. Few insurance plans cover everything, so you’ll need to have a cash reserve
to cover deductibles and extras, not to mention the furniture, clothing and sundries you’ll need when the newborn
comes home. With a new addition to the family, you’ll want to make sure that the entire family (baby, too) is
protected if something should happen to you — that means reviewing life and disability insurance to be sure it’s
adequate for your new responsibilities.
There’s the future to start thinking about, too. Will your child go to college? If so, the College Board estimates that
secondary education costs are rising 7% to 8% annually, a rate much higher than the rate of inflation. To afford the
average $7,605 total costs for a state university, you need to start saving $253 a month. Wait until your child is 7
years old and the monthly amount jumps to $308! So, it’s smart to put away a little sum each month.
What can you do to accommodate new strains on your paycheck? How can you meet all of your new
responsibilities? With an important financial goal (such as educating a child) you’ll want to work with a generalist –
– a financial planner. A lot of professionals specialize in areas such as taxes or stocks, but a financial planner helps
you understand the “big picture.” A qualified financial planner can help you sort through your current financial
situation, help you set short and long term goals and objectives, then present a “blueprint” designed to show you
how you can meet your goals while staying within your means.
There’s nothing more certain than change. And just as you learn to adapt to the changes life throws your way, you
can count on things changing with your finances as well.
This material was prepared by Raymond James for use by James B. Kruzan, CFP?, CRPC? of Raymond James Financial
Services, Inc. Member FINRA/SIPC.