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According to Time.com, the cost of raising a child until he/she is 18 years old is more than $230,000. This goes to show that having a child can be a massive expense, especially if your child goes to college. That’s why it can be a very good idea to start saving money as fast as possible. Here are some of the best ways to do it:
1. Invest early on in your life
Investing in a company or real estate is one of the best investment ideas that give you a stellar ROI. On top of that, you can also start a 529 fund investment. This type of account allows you to save money without worrying about tax. You can also go beyond that with other plans like the UTMA or the UGMA that give you even more investment options. For these latter ones you might be required to hand over the account control to the student when he reaches a certain age (set beforehand).
2. Passive income
You should consider creating a blog or re-sell things online.These are some of the best passive income resources and they can help you earn money on the side very fast. You can putthat money aside and save quite a lot in the long run.
3. Sell stuff that you don’t use
Whenever you have stuff that you don’t use anymore, just sell it. It may not be a huge amount, but every penny saved for your child will be worth it in the end. That’s why you need to have patience and focus on saving for your kid as much as possible.
4. Reduce your own expenses
Your day-to-day life might come with some unnecessary costs. Unused memberships for gyms or online services should be stopped. On top of that, you can use cheaper services and products to save a bit more as well. As we mentioned above, every penny counts and reducing expenses is certainly a step in the right direction.
5. Financial literacy
Aside from putting money aside for your child, you can also offer him/her financial education. The gift of learning about finances is very important, because your child will get to knowhow to save on his/her own. It certainly helps shape up a child’s character, and it will make it easier for him/her to save money in the long term.
6. Fixed term savings
These are bonds that you will have to lock away. Ideally you want to use these if you need them until your child reaches a certain age. However, you don’t want to overdo it too much, as these savings accounts will have a rather short term. They are more suitable for raising a child instead of contributing to his/her financial well-being more than a decade afterward.
One thing is certain, there are plenty of methods you can use to save money for your child. It all comes down to finding the right method that suits your needs and use that adequately. Trial and error is the best approach here, but once you find a good method, you should use it as much as possible. It will be well worth it in the end; you can rest assured of that!
