Navigating Budgeting When Raising Grandchildren

When raising your own children, you were probably still working and you may have had many years left in your career after they left home. However, if you’re a grandparent raising grandchildren, the situation may be a little different, and there are factors you’ll need to consider that probably weren’t issues for you as a parent. Here are a few things you’ll need to address.

Reach out to Farm Bureau to work with an insurance agent who can answer your questions, from how much life insurance you need to whether a grandchild can be added to health insurance.

Consider Your Financials

When considering raising your grandchildren, whether that looks like guardianship or adoption, it is important to weigh what would be expected from you for a long-term caregiving role and any associated costs that come with it. The costs of becoming a guardian or adopting can vary depending on factors such as legal and court expenses or if parents are still in the picture. Ultimately, the decision effects not only the emotional expectations of each party but can impact your financial responsibilities too.

In addition to budgeting for additional expenses, review your insurance coverage to make sure it reflects your new responsibilities. If you become a legal guardian or adopt your grandchildren, you may need to update beneficiaries, review life insurance coverage and make sure you have enough protection in place to help provide for your family if something unexpected happens. 

Review Your Budget

You’ve already been a parent, so you know it can be expensive to raise children. The money you’ll spend caring for your grandchildren may mean you’ll save less, change your retirement date or adjust your lifestyle to meet the needs of your grandchildren. 

You’ll want to estimate the cost of clothing, food, supplies, extracurricular activities and everything else you’ll need to buy for your grandchildren. Run the numbers to see how it will fit in your budget.

See if There’s Money Available

Depending on your situation, there may be ways that you can get assistance to help with the costs of caring for your grandchildren. If one or both of your grandchildren’s parents passed away, find out if they have life insurance policies; the children may be beneficiaries. 

This can also be a good time to review your own coverage. A life insurance policy can help provide financial security for the people who depend on you, while your health, auto and homeowners' insurance policies may need updates to reflect the changes in your household. 

Don’t forget to check with your human resources department to see if they provide benefits that could cover adoption expenses or childcare costs. 

Adjust Your Relationship

As a grandparent, you might have been more focused on fun and splurges. But when you shift to raising your grandchildren, you may need to reframe your relationship in terms of both your spending habits and how you support, guide and set expectations for them. When you’re not their parent, it’s easier to buy them the toys and clothes they want and to pay for activities. When you move into that parental role, you’ll probably find yourself turning down their requests more often as your budget shifts. You may also need to establish routines, set boundaries and make financial decisions that prioritize their long-term needs over short time wants. 

Protect What Matters 

If you take on the role of raising your grandchildren, your insurance needs might need to adjust to your new situation. Whether that be adding them as beneficiaries to your life insurance or adding a vehicle to your auto policy. Schedule a Supercheck® with your agent to make sure you have the right coverage in place.