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6/13/2019

Saving for Your Child: Father’s Day Savings Tips for Dads

Most dads would probably agree that being a dad is highly rewarding. It’s also challenging - especially when you consider that the cost of raising a child today is over $230,000.

From saving for the basics of food and shelter to being prepared for the unexpected, below are three tips to help you start saving wisely or reinforce savings habits already in place.

How to save for the unexpected

Your basement floods. Your child needs medical care that isn’t covered by insurance. You lose your job. There are countless situations that could put financial strain on your family. An emergency fund can help you manage the costs without going into debt.

  • How much?
    Financial experts recommend that your emergency fund cover at least three months of living expenses.2 An emergency fund calculator can help you determine how much you should have saved in your account based on your individual circumstances.
  • Look for a high-yield savings account
    Start building an emergency fund for your family with a high-yield savings account. You’ll earn a competitive interest rate and can access your money quickly in the event of a crisis. Look for an account like the CIT Bank Savings Builder, which rewards you for saving consistently with one of the nation’s highest rates.

Make a habit of savings

Set up an automatic savings plan to move your money from your everyday bank or paycheck to your dedicated emergency savings account without having to think about it.  

  • How to save for a down payment on a house
    If you’re considering owning or upsizing your home for a growing family, the typical rule of thumb is to put 20 percent on a down payment. 3 This may help you qualify for a more favorable interest rate and avoid private mortgage insurance (PMI).
  • Keep money safe and growing with a Certificate of Deposit (CD)
    Consider CDs, which generally have higher interest rates than savings accounts. With your funds tucked away for a set time, you’ll earn more. Once your CDs mature, that money can be used toward the down payment of your dream home. CIT Bank has a range of CDs to help you save for your goals.

Save for your child’s college education

A College Board report found that the average in-state tuition and fees at public four-year colleges is $10,230.4 Tuition is higher out-of-state or at private colleges. Tack on room and board, and the costs continue to skyrocket. 

  • Open a 529 plan
    A 529 savings plan is a great way to save for your child’s college education or private elementary school or high school tuition. The earlier you start contributing, the more time your funds will have to grow. 

Being a financial role model 

Children look to dads (and moms!) for guidance, and will learn from your example. By establishing healthy savings habits, you can teach your children the value of money while providing your family with a solid financial foundation.  

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