Despite how difficult it is, we may realize that there is a point where we need to set limits when it comes to spending money on things that may only provide our children temporary pleasure. Therefore, we must learn to prioritize our retirement savings by cutting back on the following areas rather than on frivolous expenditures that they may not actually need.
Personal belongings (Toys and Clothes)
It’s natural for new parents to want to spoil their first born son, so it’s not surprising that many of us spend a lot of money on toys. However, you’ll soon notice that your child quickly loses interest in their new toys and would usually resort to playing with your cooking utensils or any empty boxes he could find around the house.
Furthermore, we soon realize that the same pattern holds true for children’s clothing, as kids outgrow their clothes faster than we mostly expected. When we start to notice that our oldest child’s rapid growth means that the pricey clothes we buy for him aren’t worn more than twice, we can decide to switch to more budget-friendly brands. Admit it: while our children are still young, they don’t care how much their clothes cost or what they’re wearing. Instead, it is us, the brand-conscious parents, who waste money on unnecessary purchases rather than putting it into our retirement savings.
Trends and fads
As a society, we are becoming highly prone to the impact of fads, and as a result, we are spending more money than we should on frivolous activities like baby spas. We usually end up enrolling our kid in a month-long session because we’re convinced that the weekly sessions will be beneficial. You probably spent thousands of dollars on this, and looking back, you can probably think of better ways to spend that cash given how often your child cried throughout each session.
Fitness Memberships
In order to encourage them to maintain a healthy lifestyle, we may want to enroll our children in a gym on a regular basis. However, as time passes, they may lose interest in the gym, leading to a waste of membership fees. Taking this route implies signing your kids up for after-school activities that they don’t really need. Of course, there are also some exceptions. For instance, instead of enrolling them right away, you can start with the trial classes first.
Expensive shopping and social events
Our children, now entering their teenage years, have begun to express an interest in acquiring the same name-brand clothing and other high-priced accouterments as their celebrity role models and peers. The more often they started going out, the more money you’d have to give them on top of their usual allowances. But as time goes by, you’ll also see the need to stop or at least limit it when you find yourself unable to pay all of your bills on time.
Instead, you could make it clear that they would need to find a means to earn or save money in addition to their regular allowances if they wished to purchase anything above their basic needs.
Managing my own finances first and foremost is a priority
When you take the time to explore some saving tips, you’ll figure out many ways to save money, especially now that you have access to the internet. You can also get more helpful tips as parents by joining clubs and forums where parents share advice, such as HealthHub, The Asian Parent, Smart Parents, and so on.
In place of costly indoor play parks, which may cost a family of four well over S$100 for just one visit, you may want to consider giving your children the gift of experience and a feeling of adventure by taking them on a walk through a park or nature. By doing so, you’ll be able to bond with your kids in a low-stress environment, and also instill in them a deep appreciation for the outdoors. Experiences like these have the potential to impart some important lessons on children that money or possessions just can’t.
In addition, your kids will learn to respect money and be more responsible with it, which will help them set up well for the future when they are adults and have steady employment and an income of their own.
Put a little less money into the kids' college funds to put a little more into your own future
It’s in everyone’s best interest to make sure you don’t put your own needs aside in order to provide for your kids. Even if it means putting some of your children’s immediate wants and requirements on the back burner, securing your own financial future and comfort in your golden years is a priority. You and your partner can be able to begin saving for your retirement by reducing your spending on non-essentials wherever possible. This will allow you to maintain your financial independence in your golden years.
In addition, it’s best to start putting money away as early as possible so that you have a cushion in case of a financial emergency. As a ‘bonus,’ it may also give you the opportunity to leave work sooner.
Now is the time to start preparing for retirement if you haven’t yet. All you have to do is prioritize your own needs. The first step is to examine your spending patterns and cut out on unnecessary purchases. Get in touch with a financial advisor right away to start saving money for your retirement plans.