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This story originally appeared on SmartAsset.com.

Family financial planning can help you create a comprehensive strategy for managing your money as you go through different stages of life.

It starts with the basics – budgeting, paying off debt, and saving – but a family financial plan can also include things like investing for retirement and setting money aside for college.

Creating a long-term plan for your family’s finances is something you can do on your own, but it’s also something you might need the help of a financial advisor for.

Here’s how financial planning works as a family.

What is family financial planning?

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Generally speaking, financial planning means defining the specific goals you want to achieve with your money and describing the steps you need to take to achieve them. Financial planners are professionals who help people create a financial plan and then implement it.

Family financial planning is all of the above, with an emphasis on specific scenarios that families may need to plan for.

This type of financial planning takes into account the various ways that getting married or having children can affect the way you manage your money.

If you want to create a financial plan for your family, there are some key things you need to include. When you get started in family financial planning, here are some of the most important areas to cover.

Budgeting and spending

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A budget is the cornerstone of any family financial plan. If you don’t have a family budget in place, now is the time to make one. You can easily do this by using online budgeting software.

Regularly tracking your spending can help you narrow your budget and avoid overspending. There are many budgeting apps that automatically track expenses for you.

As you track your spending from month to month, review your budget to see if any adjustments are needed.

Cutting back on spending in one area, for example, can free up money that you can apply to one of your financial goals.

It’s also helpful to do an annual budget review to see how your spending has changed from year to year. You can then use it as a guide to making your budget for the next year.

Debt repayment

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If you have debt, like credit cards, student loans, or a mortgage, these should be factored into your family’s financial plan. Specifically, you need a plan and a timeline to pay off those debts.

When you have multiple debts, it can be helpful to prioritize them to decide which ones to pay off first.

High interest credit card debt, for example, might be worth the top of the list if it’s costing you the most money in interest, while your low interest mortgage can wait.

As you incorporate debt repayment into your family’s financial plan, think about what you could do to possibly speed up the repayment. Refinancing a student loan or mortgage at a lower rate, for example, could allow you to further reduce what you owe if more of your payments go to principal each month.

Financial goals

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Family financial planning means thinking about the goals you want to achieve with your money. These may include:

  • Save $ 2 million for retirement
  • Paying off your mortgage at age 50
  • Set aside $ 100,000 in college savings for your children

These are examples of long-term financial goals you could set for yourself. You may also have short- or medium-term goals in mind, like saving $ 10,000 in your emergency fund or setting aside $ 5,000 for a vacation you want to take in a few years.

When setting financial goals as a family, remember to keep them realistic and specific. Set deadlines to achieve each goal and detail the steps you will need to take to achieve them on time.

Retirement planning

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It’s never too early to start thinking about retirement, especially if you don’t want to be a financial burden on your kids later on.

Start by looking at the resources that you and your spouse or partner already have on hand. For example, if you both work, you might each be able to contribute to a 401 (k) or similar plan at your job.

If your employers offer a matching business contribution, a key part of your family financial plan may be to maximize your contributions each year or at least save enough to get the full match.

You can also consider other ways to invest for retirement, such as a traditional or Roth individual retirement account.

And of course, you both should think about where Social Security benefits fit in your financial situation once you’re ready to retire.

College planning

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Raising kids doesn’t come cheap, especially when you factor in the cost of education. Even if your kids are still small, it’s good to think about planning for college and what you can do to get ahead of the game.

Opening a 529 education savings account or Coverdell education savings account, for example, are two ways to save money for college on a tax-efficient basis.

These can be useful even if you’re starting to save late.

Discussions about college planning should also cover things like scholarships, grants, financial aid, and student loans.

As your kids get closer to college age, it’s also helpful to talk about the affordability of school choice as well as your expectations for their contribution to their education costs with a job. part time.

Insurance planning

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Insurance is something you shouldn’t overlook when developing a family financial plan.

While you can already insure your home and vehicles, and have health insurance through your job, it’s also important to consider what you need when it comes to life insurance.

Term life insurance, for example, can provide coverage for a specified period in case something happens to you or your spouse. Consider purchasing life insurance for each of you, even if one of you is staying at home and not working.

Having life insurance in place can be reassuring and provide a financial safety net if the worst happens.

Estate planning

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Having a young family doesn’t mean you can put off thinking about estate planning. At the very least, it’s important to have a will in place.

You and your spouse can use a will to determine who should inherit your property and to appoint a guardian for minor children.

You might want to set up a trust if you’ve already built up significant assets. And you might want to consider whether you and your spouse should each have an advance health care directive and power of attorney in place for a health emergency.

Should You Get A Financial Advisor For Family Financial Planning?

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While you can write your own family financial plan, there are some benefits to getting help from a financial advisor.

For example, a financial advisor can offer expertise and knowledge about things like investing or planning for retirement that you may be missing.

They can also take a big picture of your financial situation to spot planning gaps that you forget.

If you do decide to work with a financial advisor, be sure to ask them if it’s paid or not.

Fee-based advisors may earn commissions for the sale of specific products, such as annuities, while fee-based advisers charge only for services rendered.

The bottom line

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Family financial planning is something you should think about when managing money for more than yourself.

Thinking long term and planning ahead can increase your chances of reaching your financial goals.

Whether you choose to create a financial plan yourself or hire an advisor, there’s no better time than now to start.

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