Family Funds - Is Having Children Going Out of Fashion?

As we gradually move out of recessionary times, the need to save and to get the most from our savings is at the forefront of every parent's mind. While the simple answer for decent returns is to stop spending and to deposit a good amount of cash in a fixed rate account, this is easier said than done when plans for a family are still being thought about - and have been the subject of discussion since before the credit crunched.

Yet, while it is particularly difficult to predict when the best financial time to have children will occur, recent research from Irish parenting advice website, RollerCoaster.ie, is showing that some mothers may now be less enthusiastic about the prospect of having children because of the financial implications involved.

In results from a RollerCoaster.ie survey published in September, 78 percent of parents said they would hesitate to expand their families because of the increased costs involved. More than 50 percent of mothers asked admitted that it is not currently worth their while to work - because of costs such as those for childcare - and they would be better off if they were claiming social welfare instead.

The survey comes before child benefit payments are set to be either cut, taxed or means tested in the near future as part of the upcoming Budget. Yet the research does seem to have a definite focus on families that already have a number of children, and doesn't give much insight into whether prospective first-time parents are set to change their family plans. I don't hesitate to add that I doubt many adults who had plans to start a family around the time of the credit crunch are still set on putting it off - even if they did so a year ago.

Research in the UK signifies, at least, that it is not money itself which is of most concern to young mothers. In a survey by WorkingMums.co.uk, a 79 percent majority of mums pointed out that flexibility in work was the top priority during the recession - while more than half (54 percent) admitted that they would take a lower paid job for more flexible hours. One thing that is consistent in both sets of research, however, is that as the economy looks to improve more parents are eager to spend more time at home with their children - and employers are certain to need to adapt to this.

Family Financial Planning

The financial fortunes of most families tend to fluctuate over time. However, everyone wishes to have a smooth, well planned finance plan in place, so that such fluctuations do not affect them adversely. Hence, a proper planning is necessary for maintaining the economic balance of a household. Family finances need to be handled expertly, so that a household can face any possible economic scenario. Indeed, most of us often do not have the skill or expertise to perform finances managing tasks properly for ourselves. Hence, expert advice from financial advisors is often sought for in this regard.

While handling finances for families, most professional financial planners would provide certain basic tips to their clients. Such useful guidelines for effective financial planning for family include the following:

o Proper finances managing require that families do not spend too much on rather unnecessary, luxury items. Rather, focus should mainly be on buying the necessary items,

o For successful planning, individuals need to have specific targets and goals, regarding the rates of return or savings they (s)he wishes to achieve from the finance markets. Such financial targets, however, need also be realistic, so that they remain achievable, providing the desirable benefits to families at the same time,

o A family need to be prepared at all times for an emergency situation. Unnecessary expenses can be cut down , provided the necessary prior financial arrangements are in place,

o There are several tax benefits and incentives that are offered from time to time by the authorities. Taxpayers can avail of these benefits effectively,

o People should have an eye on the future while managing the finances for their families. Probable changes in the economic scenario should be kept under consideration too,

o Retirement planning and estate planning are two of the most important components of financial planning for family. There generally exists a trade-off between the two as well. Retirement planning requires individuals to store away a portion of their income in view of their impending retirement. This brings the money currently available for spending on new estates. Hence, a proper balance between these two components need to be achieved,

o For effective finances managing, families need to identify the main crisis situations that they might be faced with. The major crisis situations for a family include pay cuts, loss of jobs, health-related problems, divorce, or even natural disasters. A proper strategy to guard against the impact of such scenarios should be present.

Handling family finances in a wise, informed manner can prove to be a tricky affair. Hence, it is imperative that people take into account all aspects of planning, and, if necessary, hire the services of a professional financial advisor.