Most people consider these as their most significant expenditures: Tax, home purchase, raising children and purchasing/maintaining assets, like cars. However, each individual may have different priority, as an example, some could consider education comes at the very top.
Depending on where we live, our circumstances and other things, the amount we pay for taxes can vary widely. In countries where taxpaying is enforced, we should pay it immediately to avoid fines or even criminal charges. Tax is our contribution to the society, because the government has given many things for free, such as infrastructure and security. There are ways to reduce the amount of tax we pay, such as making some amount of charitable donations.
This will help us to both aid those in need and make tax burden easier to bear. Tax can be very complicated, if we have many assets. For this reason, we may need to hire the help of financial advisers.
2. Buying house:
Mortgage is probably one of the biggest expenditures in our lives and it may require decades to pay it off. There are many things to consider before we buy a house. It should prove to be a good investment and located in strategic places. The real estate market has its ups and downs, so we should use it to our advantage. As global uncertainty begins to bite, the house price could go down steadily.
The Internet is a wonderful tool to help us search ideal property for our future. We can specify a number of characteristics and choose house with the lowest prices. We should look beyond furniture, because it may require additional $20,000 to fill our houses with furniture and hire a decorator.
3. Raising children:
Estimates say that it requires us $200,000 to raise a single child until he/she reaches 18. This will increase significantly more if you are just planning to have a child today, due to effects of inflation and other uncertainties. If we plan ahead, financial pains can be much less. Not only the costs of having and raising children are high, families also need to consider about mortgage and other major expenditures.
This often causes them to juggle between expenses and try to allocate their revenue accordingly. If we plan to have a second child, consider storing change table, bassinette and others for future use.
4. Major assets purchase:
House is not the only thing we buy and there are other expensive purchases we need to consider. Car is probably the next expensive thing we have after our house. Having a stylish car could make us feel good, especially if it is a new model. Before going out and buying a car, we should consider our requirements and buy models that can fit our needs. Families that plan to carry many children and their gears should consider buying new cars.
If we don’t pay cash, we should organize proper financing, so we should make sure that the dealer will agree with specific agreements between us and the lender.