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Money Sense for New Families

5 Tips from Financial Planners

By Debora Geary and Reathel Geary

"While no one likes to think about facing difficult times, it's important to be prepared," says Leff. "Be sure to have adequate life insurance and an up-to-date will, and explore trust funds and other options with an estate attorney to ensure your assets will be protected and available to your child."

In case you're wondering, trust funds aren't just for rich people, and wills aren't just for people who are old. Both are excellent tools for making sure you have a say in how your children are taken care of if something should happen to you and your spouse.

Surprisingly, life insurance and wills don't require a lot of time and money to put into place. For wills, there are two options: do it yourself or consult a lawyer. It's a bit like doing your taxes – if you are willing to spend a lot of time reading and researching and your situation is fairly straightforward, one of the online will kits might allow you to do your own will.

If you don't want to put in the time or you need more than a very simple will, it is advisable to consult a lawyer – the issues involved are very important. General practice and family attorneys will often produce a simple will for about $300 to $500. You can keep costs down by being well prepared before you visit the lawyer's office, ready to answer questions about guardianship of your children and an executor for your will.

4. Save for the long term – Long-term financial planning can be a scary thought when you are still trying to afford diapers and Legos, but the experts stress the importance of planning ahead for major future expenses like college and retirement. "You've heard this before ... start saving early and often, especially for your child's college education," says Leff. "Designate funds, even if a small amount, for regular contributions to a savings plan." She recommends automatic paycheck withdrawal to save the money before you ever see it and encouraging relatives to contribute to your children's college savings.

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