Children Leaving Home
Finally they are leaving home and you now wonder what happens next.
Not only can you take your life back after years of constant parenting but you have financial decisions as well.
- Lower livings costs may mean more income
- How best to invest this surplus income
- Should you downsize the house and clear the mortgage
- Can you reduce life insurance and save money
- Can you re-evaluate your retirement age
- You should revisit your will
All these financial matters are important and you can now use your surplus income to plan for your retirement or general wealth creation.
Discussing where you want to go from here and what you both expect in these future years is the first place to start. Once you have an outline of where you want to be you can put your plans in place by seeking financial planning advice. One issue you need to avoid is the children coming back.
Before your children leave, ask yourselves:-
- Do they have financial management skills?
- What happens if they cannot work?
- Do they have high debt?
This is not just for your benefit but also for your children’s. Once they have tasted independence they also may not wish to come back. This is where they can begin their relationship with a financial planner.
This relationship can begin with a chat about something simple like income protection. That might sound alarming but it’s time for them to take responsibility for themselves and protect that new found independence.
Income protection for a young professional in their mid twenties earning approximately $60,000 could cost under $40 per month depending on occupation and health status.
If this is unaffordable think of the alternative if the income is not there.
How will debts such as a car loan or credit card be re-paid. What happens if there is a home loan also? Who will be burdened with the repayments – perhaps good old mum and dad?
If this premium is too much for now there are other ways that this can be organised such as a superannuation fund until they become more financial.