The Financial Questions to Ask Before Starting a Family
As any parent out there can tell you, having a baby, or two isn’t cheap. No doubt, those same parents would say their bundle of joy is worth every penny. The latest data out there says that having a baby will cost over $233,000 until they are 18. That does not include college tuition. It will be an emotional and financial commitment for years to come.
Think you’re ready? The team at Broussard Poché, LLP wants you to consider these financial questions.
How much do you have saved?
During pregnancy, even if you have insurance, you’ll probably have to pay some out-of-pocket expenses for your prenatal care and delivery. A normal pregnancy typically costs between $30,000 and $60,000. It’s a good idea to have at least $20,000 in the bank.
What is your current debt?
It’s important to at least attempt to have your debt down to a manageable level. You don’t have to enter into parenthood debt free, but make sure you have no trouble paying your current debt month to month.
How much of your pay are you saving?
Work up to saving at least 10% of your pay before considering adding another family member. Use automatic transfers from your paycheck to your savings account. This will greatly help with some of your upcoming baby-debt.
What will be your childcare situation?
In general, full-time infant care runs $6,590 to $16,682 a year. Easily one of the biggest expenses is child care. Raising a child without family or some sort of help nearby is possible, but pricey. Research daycares and nannies to find what’s in your budget in your area.
There are many ways you can cut costs once your baby arrives; trade clothes, borrow baby supplies, shop at thrift stores for used toys and more. Starting a family is a major undertaking but one that can be tackled with smart planning and savvy saving.