Welcoming a Bundle of Joy: Financial Planning for Your New Arrival

Joshua Dobi |

At North Main Financial Group, we’ve had the pleasure of celebrating countless new additions to our clients’ families. The arrival of a baby is a joyous occasion filled with adorable moments and heartwarming memories. Amidst the sleepless nights and diaper changes, it’s essential to incorporate financial planning into the mix. Beyond the immediate needs of diapers and the anticipation of a college fund, there are crucial financial considerations that can sometimes be overshadowed in the excitement of a new baby.


Once the initial excitement settles and you and your little one find your rhythm, here are three financial planning steps to take that will benefit you in the long run.


1. Review Your Life Insurance Coverage:

Especially pertinent with the arrival of your first child, the transition from a family of two adults to a family of three necessitates a reevaluation of your life insurance coverage. Your newborn is entirely dependent on you in many ways, including financially. This shift in dynamics emphasizes the importance of having the appropriate amount of life insurance for your new family configurations. Take the time to reassess your coverage and ensure it aligns with the financial protection your growing family requires.


2. Evaluate Beneficiary Designations:

While not typically considered on an annual basis, reviewing beneficiary designations becomes essential when welcoming a new child into your family. Whether you’re adjusting designations for parents, grandparents, or other extended family members, it’s essential to ensure they reflect your current wishes. It’s a common oversight to have children listed as direct beneficiaries on various accounts, not realizing that a newborn cannot inherit directly. Planning ahead by establishing trust provisions can help ensure your child is well-cared-for in case of u unforeseen circumstances.


3. Understanding the Limitations of a Newborn’s Inheritance:

An important point often overlooked is that a newborn or minor cannot inherit directly. Despite children being listed as direct beneficiaries on life insurance policies, retirement accounts, and other holdings, they would not be able to inherit directly. In such cases, provisions are typically made through the orphan’s court to establish a trust. Proactively addressing this ensures that your child’s financial well-being is prioritized, even during the hectic early days of parenthood.


While the arrival of a new baby is undoubtedly a cause for celebration, taking a moment to engage in financial planning is a responsible and caring step for the future. Beyond the immediate joys and challenges of parenthood, these considerations will provide a solid foundation for your family’s financial well-being. Embrace the adorable moments, capture the cuteness overload in pictures, and remember to take the time for essential financial planning – ensuring your little one’s future is as bright as their first smile.


If you have questions about your financial space, call us at (704) 987-1425 or visit us virtually at www.northmainfinancial.com. If you wish to schedule an introductory meeting, we would be happy to meet with you at no cost or obligation to you.


These Blogs are provided for informational purposes only and should not be construed as investment advice. Any opinions or forecasts contained herein reflect the subjective judgments and assumptions of the authors only and do not necessarily reflect the views of Osaic Financial.