Being financially prepared before the arrival of your baby means peace of mind. After all, you want to completely enjoy your new addition with confidence you can care for him/her without worry. Though money isn’t the only way in which you need to prepare, it is certainly important. Here are some ways to financially prepare for a baby.
Financially Prepare for a Baby #1: Speak to Your Employer
Not all women are guaranteed any form of maternity money or benefits. It is important to know exactly what benefits you have early in your pregnancy or even before. Knowing whether or not you can take paid leave is crucial to your family’s financial security during that time. This is especially true if your income is a major contributor to the family budget.
If you’re concerned about talking to your employer, check your employee manual. Additionally, many companies have Human Resources departments to deal with these types of things efficiently. If you don’t have paid leave, ask if you can work remotely or do part-time until you return. Work out the details and make sure to get it in writing.
Financially Prepare for a Baby #2: Make A Budget
It is also important to know how much additional money you need when the baby arrives. There are some things that are absolutely necessary from the start, including diapers, equipment, formula (if not breastfeeding, clothing, etc. Also, consider you may have medical bills to pay.
Create your new budget, considering all of the changes to your lifestyle. A reduction in income will be the number one thing to affect your spending. However, many families discover that mom staying home actually doesn’t change that much. This is mainly true if you have other children that have been in daycare.
When you are making your budget, it’s a good idea to secure ample life insurance for both parents and the child. If anything should happen to you, having the best term life insurance you can get will pay the bills and enable the family to live with financial security.
Financially Prepare for a Baby #3: Start Saving
The earlier you start saving for your baby’s arrival, the better. Put whatever you can spare into a savings account, ideally with a high yield interest rate. Calculate what you need and double it to be on the safe side. Don’t worry if you’ve started saving late in the game. Anything is better than nothing. This will help pay the bills when you can no longer work or if you have an emergency.
Financially Prepare for a Baby #4: Sell What You Don’t Need
If you need to extra money and want to free up some space for your baby’s arrival, sell what you don’t need anymore. There are a number of different ways to do this, such as selling online or at a garage sale. Put the money you make into your savings or use it to purchase baby items. Don’t sell things you are going to need or that mean a lot to you unless it’s absolutely necessary. However, this is the ideal time to take an objective look around your home and de-clutter.