Financial Planning for First Time Parents
So you’ve found out that you’re expecting a bundle of joy in just a few months—congratulations! Having a baby is a very special time.
While there are tons to do beforehand like preparing the nursery, choosing the right doctors, and remaining healthy, there’s also financial planning to be done. While it may seem a long time off, you’ll want to be prepared before your baby arrives and sleep deprivation kicks in. We’ve outlined a few things you should be aware of when preparing for your child to come along.
Child Care Costs
If you plan to go back to work upon the completion of maternity leave, you’ll want to start weighing childcare options. Sooner is always better as spots can fill up rather quickly. Whether you plan to stay home with the baby or utilize daycare, your budget will be affected. Ensure you account for extra school costs or the loss of income from one spouse staying home.
Once your baby arrives, you’ll need to be prepared to enroll them in a health plan. You will have approximately 30 days after your child’s arrival to put them on an insurance plan. Try to get as much of the paperwork completed before the child arrives so you’ll have less work once he or she makes their debut.
Whether you are a single or multi-parent household, your financial goals and priorities may change once your baby arrives. You will want to assess your life and disability insurance needs with your financial advisor to ensure if something were to happen that your family is set up for success. If you’re uncertain of how much insurance you will need, you can meet with a financial advisor or even take a look at some online calculators to get you started.
Plan for Maternity/Paternity Leave
Take a look at company policy for maternity/paternity leave in advance. If it’s unpaid, you’ll want to account for the lack of income while you’re out of the office.
Update your Post-Delivery Budget
Once baby arrives, you’ll have some added expenses you might not have had prior: diapers, wipes, formula, baby food, clothing, gear, etc. It’s easy to go overboard on cute onesies and the high-dollar stroller system, but be sure to shop around. You can find quality equipment at really great prices.