NEW YORK, September 15, 2021 (Newswire.com) - iQuanti: Financial planning is an essential component of adopting a child. You'll want to not only prepare for the time and monetary costs that come with the adoption process, but also things like healthcare, day-to-day expenses, life insurance, and the financial future of your child.
1. Understand the time and monetary costs
There are many ways to find children in need of loving parents, and each comes with its own unique costs and procedures. The entire process can take months, sometimes even years from start to finish, and costs can vary greatly depending on what route you decide to go and what sort of help you elicit from attorneys and agencies.
- Foster care is one of the most inexpensive ways to adopt a child. Costs can generally range from $0-3,000, depending on your state and how much you incur in attorney fees.
- For international adoptions, consider travel expenses and time spent in the country. It's not uncommon to need to take multiple trips, to be required to stay there throughout the adoption process, and/or to wait until the child is born.
- Private adoptions and adoption agencies are among the most common ways to adopt a child, as adoption agencies tend to take care of many legal and logistical aspects of adoption. This is also often the most expensive route to adoption.
2. Get financial assistance
Regardless of what route to adoption you take, there are many ways to get help in covering the costs.
- You may be eligible for non refundable tax credit of up to $14,300 per child. This tax credit is meant to offset expenses for things such as adoption fees, attorney fees, traveling expenses, and court costs.
- Adoption grants are essentially monetary gifts that help you cover the financial costs of adoption. Grants are typically offered by nonprofit organizations dedicated to helping families adopt children in need, and may cover the cost of any or all of the aforementioned fees.
- You can also ask your local community to help. Being specific about what financial challenges you're trying to meet, such as raising X amount of dollars to finalize the adoption process, may help encourage friends, family, and neighbors to help pitch in.
3. Update your life insurance
It's important to update your life insurance during any major life event, and an adoption certainly qualifies as such. Before you make any adjustments, it helps to make a budget of what your living expenses will look like with your new child.
- Be sure to include expenses for childcare, healthcare, and education savings as well as basic needs expenses such as food and clothing. You can use a life insurance calculator to help determine how much coverage you should get..
- Some states and adoption agencies also require life insurance for adopting parents. Generally speaking, the sooner you're able to get a life insurance policy, the better, as premiums can go up with your age. That said, it's best to wait until the adoption process is finalized before naming your adopted child as a beneficiary.
- So long as you are the legal guardian of your adopted child, you can name them as a beneficiary on your policy just the same as you would a biological child. Keep in mind that minors cannot legally receive a death benefit until they become legal adults.
The bottom line
The adoption process is no small feat, but with proper planning you'll be welcoming your child into their new home in no time. One of the best ways to welcome a new member of your family is to be financially prepared to provide for them no matter what.
Source: iQuanti, Inc.