Here Comes Baby: Funding Your Child for an Open-Ended Destiny

5 min. readbyVexxit StaffonDecember 05, 2019
What does the future hold for your child? It's one of the biggest questions parents have when bringing a new life into the world. Setting them up for success means having your finances in good order. Let's investigate.

There is joy, there is love, and then there is fear. The fears, as experienced parents will tell you, only get bigger with age, and multiply with every sibling.

There will be vast tracts of sleep deprivation. Disposable income will be allotted to the littlest ones, leaving less or none for yourself. Your social life will go on hiatus, possibly permanently.

At least there is streaming video. And while the baby percolates in vitro, or keeps you up all night with its voracious appetites, you might catch up on what The New York Times calls, “the most profound documentary series in the history of cinema.”

“Seven Up!” aired in 1964, documenting the lives of 20 British kids, premised on the adage of “Give me a child until he is seven and I will give you the man”. Every seven years, a new episode reviews the progress of their lives. It is the original reality show, a fascinating sociological experiment, and damn compelling TV.

The ninth, and likely final, episode – “63 Up” – was released this year. While providing a glimpse into the show’s production, NYT writer Gideon Lewis-Kraus rather profoundly sums up parenthood:

Our deepest hope for the children we love is that they will enjoy the liberties of an open-ended destiny, that their desires will be given the free play they deserve, that the circumstances of their birth and upbringing will be felt as opportunities rather than encumbrances; our greatest fear is that they will feel thwarted by forces beyond their control.

Directed by Michael Apted, 63 Up reveals more life-changing decisions, more shocking announcements and joy and tears in equal measure.

Many parents believe education is the surest means of preparing kids for broader horizons and higher achievement. Yet saving is rarely easy, because… mortgages, car payments, renovations, groceries, holidays, taxes, sports clubs, winter gear, summer camps… and you hear yourself echoing your own father about money not growing on trees.

If you can swing it, the Registered Education Savings Plan (RESP) is a boon. Upon contributing $2,500 (or convincing Grandma to do so) the government kicks-in $500. Do this annually, while earning an average of say, 8%, and by the time your kid is 5, you could already have enough to pay for her first year of university. By the time she is 17, your fund could be in the six figures.

There are more rules of course, and you can contribute smaller amounts. But the trickiest bit is, how to both protect and grow the money before junior reaches college age?

Fortunately, there are professionals specializing in this kind of family financial planning. Maybe it’s sorting out an RESP; maybe it’s exploring investment strategies or maybe it’s just someone to talk to when you need money advice. It’s important to find a good match – someone you can be honest with and whose advice you can trust.

A child will expand your heart exponentially and fill your life with purpose, but will absolutely not help you sleep at night. A solid financial advisor surely will.

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