There is perhaps no greater joy in life than becoming a parent. Once that tiny, adorable, little life enters our world, everything changes, mostly for the better. But parenthood is not without its challenges, especially when it comes to raising a little person that will eventually grow into adulthood. Those four A.M. feedings eventually turn into the forming of young, developing minds and they seem to grow up so fast that we need to do everything in our power to protect and educate them as soon as possible.

One of the biggest challenges that many young parents will face are the rising financial worries and stress, the increasing costs that accompany raising a child and the new life ahead with so many responsibilities. According to Marketwatch.com, the average cost for the complete upbringing of a little one is approaching the quarter-million dollar mark.

While we all know that money doesn’t buy happiness, we still need some strong financial security in order to bring our baby up properly into adulthood. But more importantly, we need to pass on important money-related skills to our children to better prepare them for a solid financial future.

For example, while most adults will carry a comprehensive life insurance policy for the protection of their spouse and children, but according to some statistics, most people only carry enough coverage to last for a lapse of three years of their missing paychecks. Experts recommend a minimum of fourteen years of insurance coverage to properly protect our families. Especially for younger couples, these rates are more affordable than ever when obtained early.

FINANCIAL LESSONS LEARNED AND PASSED ON

One of the best things that we can do as parents is to set a good example for our kids and this includes financial responsibility. Giving them an allowance is one thing, but not teaching them how to save, spend and share their wealth is often overlooked. Some parents believe that good spending, saving and charitable habits comes along with adolescence, but younger children should also be guided with better financial practices.

SPLURGING VERSUS SMART SPENDING

Halloween is often an opportunity for parents to educate their children on the importance of not over-indulging on their precious treats, and the same is true for money management. Trick-or-treat only happens once a year and even if they are on a set schedule for receiving an allowance, as we all know, “stuff happens,” and parents should communicate this fact to their offspring. Splurging on big ticket items can leave us vulnerable to things that we (or they) may actually need or want in the future.

SAVING UP FOR A RAINY DAY

One of the best examples we can set for our kids in the importance of a “safety net” when it comes to money management that comes with a savings account. Depending on the child and their upbringing, many kids enjoy the process of watching their young “nest egg” grow in value. Whether they’re saving up for their future or stashing away cash for a big purchase later on, parents can associate this with real-life situations.

Many of these examples may seem obvious, sometimes they are overlooked in the myriad of ever-impending parental responsibilities. While we are teaching them how to say please and thank you, at the same time, we should be showing them how to spend and save practically.