Parenting can be stressful. Between juggling busy schedules, managing family expenses and investing in your family’s future — whether it’s saving for a home, a college education or retirement — it can be tough to balance it all.
And finding balance can be especially hard on women. According to a study from the Proceedings of the National Academy of Sciences, women are still more likely than men to take time out of the labor force or reduce the number of hours worked because of caretaking responsibilities. The “motherhood penalty" is a significant contributor to the persistent gender pay gap and the underrepresentation of women in leadership roles globally, according to the World Economic Forum.
The summer break is a great time to revisit your finances and make sure that you are making the most of every resource to help build and secure your family’s financial future (including your own).
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Workplace benefits are a sometimes-overlooked resource that can play a supportive role in helping you and your family work toward various financial goals.
Here is a path toward maximizing your workplace benefits for the whole family:
Advance your long-term financial goals through workplace wellness benefits
Although setting long-term financial goals and creating a path to achieving them can be daunting, your workplace likely offers financial wellness benefits or a program to guide you down the right path.
No matter how distant your long-term goals seem, it’s crucial to invest in your financial future at every stage of life. The longer you invest, the more you’ll potentially build in your nest egg by the time you retire. Further, this leaves time for your returns to compound.
In fact, our research from Morgan Stanley Wealth Management shows that older investors would advise younger generations to start saving as early as possible (74%) and invest for the long term (54%). The key is to identify your goals and get started as soon as you can: Most people are primarily saving in the long term for retirement (78%) and an unexpected emergency (56%) — and many are doing so through their workplace benefits.
As a first step, sit down as a family and assess what your long-term financial goals are and a timeline of when you’d like to achieve them. Are you setting aside money for college? What age would you ideally like to retire? Is your family complete, or do you anticipate having more kids? By setting clear goals and creating a realistic road map toward reaching them, you’ll be better equipped to make informed decisions about your finances. And look for opportunities to include your kids in the conversation — it's never too early to start building financial literacy and awareness.
Next, review where your money is going and create a budget — this includes your income sources, debt payments, credit cards and bills. One way to do this is through online tools such as debt calculators, retirement calculators and budgeting apps, which can help you track your monthly income and expenses. If your employer offers a financial wellness program, you can utilize budgeting tools, savings support and even potentially access professional financial advice.
Consider using the 50-30-20 rule to help you budget: Put about 50% of your money toward necessities like food, housing and childcare, 30% toward leisure such as family activities, and then you have 20% left to put toward your long-term goals. For example, if you’re saving for your child’s college education, start contributing to a 529 plan. You can set up automatic contributions, and most states have no minimum or maximum limit. Your workplace may also offer savings programs or vehicles, such as savings accounts attached to 401(k)s.
Keep in mind that life is unpredictable — especially when you have a family. If you don’t have one already, consider setting aside even $10 a month to start building up an emergency savings fund. It’s a good practice to keep this in a separate, easily accessible account just for emergencies — such as a savings account, money market account or CD account. Ask your employer if they offer an emergency savings account match or any additional savings, budgeting or financial planning support.
Align your workplace benefits with short- and long-term goals
Look over your budget and goals and see where you can plug in your workplace benefits to better support your progress. For example, if your employer offers a retirement plan such as a 401(k), enroll. Look for wiggle room in your budget to increase your monthly savings contributions. Also, find out if your employer offers a 401(k) match and make sure you’re contributing the right percentage amount to receive the employer match. Our research shows that employees (64%) consider their 401(k) to be the most important benefit in meeting retirement goals.
Beyond direct contributions to retirement benefits, your workplace may offer additional benefits that can help you build investments — for example, equity compensation is growing in popularity, with three in four HR leaders (76%) reporting that their companies are offering some form of equity compensation — up 4 percentage points year-over-year and 11% since 2021, according to the Morgan Stanley at Work State of the Workplace IV report.
Your employer may offer benefits related to family needs: If you’re saving for college or heading back to work, some workplaces offer student loan repayment and return-to-work programs. Also, if you’re caring for young children, or a part of “sandwich generation”— taking care of children and elderly parents at the same time – your employers may offer flexible work arrangements. Today, about one-quarter of adults are in the sandwich generation, with most also working part or full time, according to a Care for Business report.
If you aren’t sure where to start, talk to your employer — they can help answer questions, provide information to help you take advantage of workplace benefits and direct you toward resources that can help you navigate your financial life. For example, our State of the Workplace IV report shows nearly 9 in 10 HR leaders offer financial wellness programs to help counterbalance work-life stressors.
For more nuanced questions, or for help building a more holistic approach toward your family financial goals, many companies also offer access to personalized financial guidance, such as self-guided financial education, a financial coach or financial advisor who can understand your family's unique situation and provide deeper support. At the end of the day, the health and happiness of your family is a top priority. Taking the time to invest in your family’s financial future today can bring peace of mind and allow you to focus on what matters to you most.
This material has been prepared for informational and educational purposes only. As such, Morgan Stanley Smith Barney LLC (“Morgan Stanley”) is not acting as an investment advisor as defined under the Investment Advisers Act of 1940, as amended.
This material does not provide individually tailored investment advice. It has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. Morgan Stanley Smith Barney LLC (“Morgan Stanley”) recommends that investors independently evaluate particular investments and strategies and encourages investors to seek the advice of a Morgan Stanley Financial Advisor. The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives.
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Morgan Stanley Smith Barney LLC (“Morgan Stanley”), its affiliates and Morgan Stanley Financial Advisors and Private Wealth Advisors do not provide tax or legal advice. Clients should consult their tax advisor for matters involving taxation and tax planning and their attorney for matters involving estate planning and other legal matters.
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