The Dependent Care That Matters – Part 1
What can you and your family do better to manage your dependent care responsibilities?
The care you give for another is called “dependent care”. Put your tax forms and employment forms out of mind for a moment. Regardless of these forms, taking care of family members on a regular basis is dependent care whether you receive any tax breaks or employment benefits or not. It’s still something you do and because it’s a part of what you do, it too is your business.
Allow me to give an example. As a parent of an African American daughter, there are grooming expenses that we will incur that other ethnic groups don’t, at least not to this degree. We have expensive braids, hair weave and hair appointments. These things, when not considered, could create a problem in our budget. After several years of such challenges, using tools like Mint, we decided to make a category for our daughter’s expenses, dependent care. Once I had numbers for a year, I then knew how much money to put aside each month in order to be prepared for these expenses. That’s what having a plan does, make you better prepared for what’s coming at you whether you plan for it or not. Let’s go a little deeper.
I don’t want you to miss out on tools that can help you better manage. In fact, your employer may provide some very good benefits that could offer you some relief. Here are two tools we’ve used.
- Wageworks. Let me tell you how big of a fan I am of Wageworks. With Wageworks, payroll deductions are taken and applied to your Wageworks account before your taxes are taken. In many cases, you won’t notice a big drop in your take-home pay when using it. With Wageworks you can pay for dependant care expenses such as daycare, summer camp, and after-school care programs. Research what your company may offer in this regard. You don’t have anything to lose, but the headache of trying to provide for your dependents the hard way—without tools to help.
- HealthEquity. This benefit is similar to Wageworks with the added advantage of pre-tax deductions for healthcare expenses. You can set a predetermined amount aside each month to handle qualifying recurring medical costs for you and your family. This way the expenses are covered and don’t impact your pocket in an unexpected way.
All of this might sound a little much, but remember your life is your business and someone has to handle the business. I want you to have the tools that will equipment you to make the best of it.
Today is Friday!
It’s easy to overlook the benefits that are staring you in the face simply because very few take advantage of them. You won’t hear much about this stuff because doing your life, your business well is an uncommon accomplishment. Find out what’s available and put in the work to not only take advantage of a benefit, but make your hard-earned dollars work better for you.