4 financial tools that all parents should consider, whether their child is a newborn or a teen

• Having a baby often makes people reevaluate their finances.
• Things such as life insurance and investments can help increase your child's financial security.

I'll never forget standing in my home office trying to nurse my infant daughter while waiting on the phone to update my husband's medical-insurance policy. I was frustrated, hot, and covered in sticky, sweet newborn fluids. Instead of enjoying my baby, I was cataloging my financial to-do list.

Now that I had a whole new person to look after, I needed to buy life insurance, open a college savings account, and be a bit more proactive about increasing our financial security. My daughter and I spent much more time huddled in that office during my maternity leave.

Finances are a common concern for many parents, Jenna Lofton, a certified financial planner, said. And while you may dream of a newborn phase filled with snuggles and cat naps, it's an important time to take a serious look at your finances.

"When parents welcome a new baby into their lives, there are several financial steps they can take to secure their child's future," Lofton said.

Here's what she recommends.

Get — or update — life insurance

Having up-to-date life insurance is one of the most important things you can do to look out for your child. No one wants to think about the worst-case scenario. But if you or your partner die unexpectedly, life insurance can alleviate some of the financial burden so that your family can continue to live the life they're accustomed to while healing from the loss.

Some professionals tell you to take out 10 times your annual income. When I was shopping for life insurance, that amount of coverage was way too expensive. So I was happy to hear Lofton's advice.

"Parents should consider a policy that covers their income and any outstanding debts," she said.

I decided to purchase enough life insurance for my husband to pay off the mortgage and stay home for a year with our child before he had to worry about replacing my income. And don't forget — stay at home parents need life insurance policies, too.

Consider saving for college

College is one of the biggest expenses that many parents will encounter. So it's best to start saving for it early. The best way to do that is by opening a 529 college savings account. These accounts let your money grow without being taxed, Lofton said.

"Earnings in the account grow tax-free, and withdrawals for qualified education expenses are also tax-free," she added.

There are many ways to use 529s for qualified expenses. You can even roll unused funds into your retirement account so you don't need to worry about "losing" the money if your child doesn't attend college. Learn more about 529 plans to see just how flexible they can be.

Open a custodial investment account

Babies can't invest. Using custodial accounts from the Uniform Gifts to Minors Act or the Uniform Transfers to Minors Act, you can invest on behalf of your child. They'll get access to the money when they're 18 or 21, depending on your state, Lofton said.

At first, I wasn't convinced that my daughter needed a UGMA account since we're not rich. But then I realized these accounts had a lot of potential. The best way to grow money is by leaving it in the market. So I direct a portion of birthday money and other gifts to the UGMA account, hoping it will be even more helpful when my daughter is older.

There's one major caveat to be aware of with a UGMA or UTMA account, Lofton said. Since they're the property of your child, they can influence college financial aid.

Think about retirement early

Before you know it, your baby will be a teenager with a job. And that's the perfect time to open a Roth individual retirement account, a type of retirement savings account. You don't even have to convince your child to put their own money into the Roth IRA.

"If a child starts working during their teenage years, parents can contribute to a Roth IRA on their behalf," Lofton said. "This helps build a foundation for retirement savings early on."

Just be aware that you can contribute only as much as your child earns in a year, she said.

Building financial security is highly individualized. While these four tools aren't right for everyone, they're a great opening to a conversation about financial wellness.

"To determine what's best for them, parents should consider their financial goals, risk tolerance, and their child's potential needs," Lofton said.

If you need extra guidance, meeting with a financial planner can help.