Father’s Day special: Embarking on your paternal journey? Here’s a financial planning checklist

It is best for both people in the family to have adequate health coverage under a single comprehensive family plan.

June 15 is observed as Father’s Day this year, as it falls on the third Sunday of every June.

Having a child is one of the most wonderful feelings. Moments before their children’s birth, expectant fathers feel great pride. This is often accompanied by a revaluation of financial plans by the couples.

Take a relook at your family budget

Let's start with the most important step every expectant father must undertake first. Prepare a checklist of all expected expenses: pregnancy, medical consultations, hospital expenses, postnatal care, vaccinations, baby items, and essentials. Include all possible headers and rework the expenses you’ll be expected to shoulder as a new parent.

It would be wise to also keep track of the regular household expenses that are recurring each month, such as existing EMIs, rentals, groceries, etc. This checklist will help one evaluate the monthly expenses and revamp the new family budget.

Buy adequate health insurance cover

A lot of people forget to evaluate adequate insurance ahead of becoming parents. More often, Indian families use group insurance from their employers, ignorant about the fact that a number of them do not cover maternity expenses. It’s important to examine your health policies and find out if they cover maternity, medical consultations, and hospital expenses.

It is best for both people in the family to have adequate health coverage under a single comprehensive family plan. After the baby is born, the parents must notify the policy right away. Should you find that your existing insurance is not enough, opting for a top-up policy will help you broaden your health coverage.

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Get a life insurance cover in place

Buying life insurance is a crucial financial matter that ought to be handled sooner than later. Given the uncertainties of life, like the recent pandemic, families, especially new parents, need to be better prepared for any eventuality.

Parents need to actively invest in term insurance plans that provide immediate cover to the family in case of financial uncertainties. Generally, insurance representatives recommend buying a cover that is 10-15 times your yearly income. Any life insurance policy you get should help pay for your child’s future education and secure your family’s future in case of uncertain circumstances.

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Start early, invest smart to fund your child’s dreams

As soon as the basics are covered, the next task is to invest for your child’s future goals. A thorough discussion with a qualified professional will help you ascertain your financial plan vis-a-vis your life goals in times to come.

Your child’s schooling, higher education, any loan that you may need alongside – all need to be planned for. A clear setting of goals and sound financial plan will help you achieve these milestones.

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Bolster your emergency fund

The importance of an emergency fund cannot be stressed more. Sudden loss of employment, drop in income, emergency medical bills, unplanned travel, natural calamities… all of these situations call for unexpected expenses. Which is why planning for such emergencies is encouraged. An emergency fund provides for a safety net for one’s family, especially newborns, to continue getting the necessary care till the family comes out of unexpected situations.

To conclude, parenthood bring you joy and responsibility in equal measure. What can make this a ‘pleasant’ journey is a sound financial plan that allows you to lead a comfortable life and offer the same to your children in due course of time.

The writer is CEO, FPSB India.

Disclaimer: The views expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any decisions.