Having a child is daunting, especially for those living in Singapore.
With a high cost of living and a stressful environment to match, most young parents now have to juggle both work and parenting. We know that crossing the going from married life to parenting a child is a tough life stage to cross, so we’ve decided to come up with a one-stop guide for managing your finances for your first child!
Your Personal Finance Guide To Planning On Raising A Child In Singapore
With these tips and hacks, raising a child need not be too expensive a feat.
Cost of Raising A Child
Raising a child may be one of the greatest financial decisions you and your partner will have to face. Unlike buying a car, or a new BTO flat, raising a child involves more than just money. What’s more, bringing a person to earth entails so many hidden costs, that it is almost impossible to project how much it will cost to raise a human being.
We were, however, a little ambitious. With some assumptions and parameters, here’s a good estimate on how much it will cost you, should you decide to have a child.
Especially if you plan on living in Singapore, we projected that you will need about $285,468 on average to raise a child. How did we come up with this figure? We’ve included the amount of money spent from pregnancy to birth, all the way to daily necessities needed for the child.
Given that we are staying in a kiasu climate like Singapore, we’ve also included a conservative cost of getting tuition and enrichment classes for your child, in the projection as well! This adds up to about $93,035.40, just on tuition and enrichment classes alone.
Given the costs entailed with having a child, it’s prudent to know where to get the cheapest diapers, baby food, and milk formula as well! With that in mind, we took a look at the prices of baby products online, in retail stores, and even across the causeway in Johor Bahru, to find out what are the best cost-saving purchases you can get for your baby!
After our trip, we found that the cheapest organic snacks and food for babies can be found across the causeway, and that it is not true that retail stores are more expensive than online shops. To mitigate the cost of daily necessities, you can also consider getting a Cashback Credit Card so that you save some money while you shop!
Cost Of Childcare
When it comes to our children, we want only the best. But what happens when work calls and we’re unable to take care of our children as much as we would like to?
It’s a tough situation that many young, new parents find themselves in, especially so when both are working adults. For those who need childcare options, here’s a breakdown on the different costs, and options for you.
Baby Bonus In Singapore
By now, it is an open secret that the government is looking to boost Singapore’s birth rates. With the Baby Bonus Scheme, couples can mitigate the cost of having a baby with these government incentives! This includes up-front cash gifts from $8,000 to $10,000, and payouts to your child development account. With these rewards, you can look to save up to $28,000!
Best Savings Account For Children
Your parents may have given you a POSB Kids Account when you were a kid, but with banks boasting higher interest rates of about 1-2% recently, it doesn’t make sense to stick to an account that gives you a mere return of 0.05% interest rates.
As we all know, the power of compounding interest may help you save up more in the future, so why not start one for your child?
With the Baby Bonus scheme mentioned above, you can also choose the Best Savings Account to maximise your baby’s Child Development Account. To learn more about the tips and tricks to do this, here’s an article that will bring you through the process:
What Insurance Should I Get For My Kids?
Now, I tutor part-time for a living, and I used to teach music to a bunch of 20 or so 4-year-old kids. Trust me when I say that children are balls of energy that will skyrocket through your homes and streets. It is important, and I would even say almost compulsory, to get your child covered from unforeseen circumstances that will lead to a black eye, or even a hospital stay.
When you insure your child, not only will you have a better peace of mind, you will be able to save a bit of money as well! In the event your child gets into an accident. Of course, there are different types of insurance at different life stages of a child. So if you are keen on finding out more, you can also head over to this QnA page, to find out more about baby insurance!
CPF Hacks To Give Your Child A Headstart
Yes, we know CPF is usually talked about when you are looking to retire Yet, it is never too early to give your child a headstart. It is common for Singaporeans to purchase endowment plans or invest for our children. In fact, some parents are looking to topping up their children’s CPF accounts to give them a headstart in life.
As the Singaporean saying goes, you can never be too kiasu in life. If you are looking to optimise your child’s CPF account, here’s how you can do it:
Having a child is daunting, but there are lots of support and help available to help tide you through this period of uncertainty. With some help and a bit of patience, you will be an expert in no time!
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