Pregnancy comes with a number of challenges. For some parents, challenges arrive long before the baby does. One of the largest burdens, especially for new parents, is the financial burden.
While some parents have the resources to plan a pregnancy, others are financially caught off guard. Pre-existing responsibilities like bills and everyday cost of living already consume most of people’s income, so stretching that income even further to pay for baby necessities can cause a bit of stress.
Luckily, there are financial experts willing to work with expecting parents to establish a pre-baby budget. Even if you aren’t able to make additional money, having a financial game plan during pregnancy provides a cushion. Here are a series of tips experts suggest before your little one arrives.
Creating a Financial Game Plan During Pregnancy
During the first trimester, there are a few financial burdens you can tackle. For instance, it’s a good idea to estimate the cost of living for the first year of your baby’s life. You can use an online estimation calculator and divide the yearly cost by month. Be sure to include healthcare expenses to this total.
If you and your partner plan to go back to work, you’ll need to factor child care expenses into your first-year baby budget. Speak with your partner about strategies to pay your living expenses while putting this money aside.
The first trimester is also a great time to establish a payment plan for additional debts like student loans or credit card bills. Some experts suggest paying off what you can and transferring the remaining balance to a low-interest rate credit card. If you can’t afford this option, ask your lender if they can defer your payments to a later date.
During your second trimester, you’ll need to get your will and life insurance in order. A rule of thumb is buying a policy of at least six times your gross income. Even if you haven’t found out the sex of your baby, this is the best time to draw up a will and speak to whomever you decide to name as legal guardians in case of an emergency.
Toward the end of your second trimester is the perfect time to begin making a registry. This is also a great time to begin planning a baby shower. Baby showers allow you to invite loved ones over and get some of the items you need for your little one. If you know the gender of your baby, you can also ask your loved ones to donate gently used items to cut costs.
Spend some time daycare shopping as well. The last thing you want to do is spend your maternity leave juggling your newborn, healing and interviewing caretakers. This is the perfect time for you and your partner to tour facilities and narrow down your favorites before going into labor.
This is home stretch, so you’re essentially tying up any financial loose ends. Gather your important documents like proof of insurance and pack them into your hospital bag. You should also open a safety deposit box in case your little one accumulates bonds and other precious materials. To be safe, keep records of everything going into your deposit box. You can use an online site to track those bonds as they grow in value.
Giving birth should be as stress-free as possible. Not only does stress cause pregnancy complications, but it can also drive a wedge between you and your partner. Open communication between the two of you about the present and future finances naturally helps with overall communication and parenting decisions.
You don’t have to do it alone. Whether you hire consultants or use financial websites, seeking money-related assistance is a wise idea. Some of these websites also give advice on setting up college funds.
By creating a financial game plan during pregnancy, you can brace yourself for your parenting duties. In addition to saving money, do your best to make arrangements with your lenders to defer payments. By making small changes, you and your partner can focus on what’s important, like creating memories.