Financial Planning for Baby

When making the decision on when to have children, there are many considerations to take into account. Perhaps one of the most important is whether you are financially prepared to have a baby.mom and baby

Before conception:

  • Pay Debts. A baby makes life much more expensive. Being debt-free or almost debt-free will make it easier. Take care of college loans, credit card balances and car loans before trying to expand your family.
  • Save some money for retirement. Retirement savings are essential to establish before conception. It is easier to put aside extra dollars before an expensive new arrival than to try to start a retirement account while your children are young.
  • Research your health plan. Read the fine print of your health insurance coverage. Add up the prenatal care and childbirth expenses that your insurance won't cover, and save for those expenses ahead of time. It could also be beneficial to explore alternative plans or your spouse's plan to see if they would make having a child more affordable.

After conception:

  • Consider buying life insurance. Life insurance can ensure that your child's standard of living will not be affected in the event of your death. If you already have life insurance, be sure to update your policy.
  • Write a will. Use an attorney so that you will have peace of mind that your will is legally binding. It is important to choose guardians for your child in case something happens to you and your significant other. A will also establishes the beneficiaries of your estate, and how your assets will be distributed. For example, you might want your life insurance to benefit your child, but if your child is under 18 you will want to designate an adult to oversee how the money is spent.

Preparing for arrival:

  • Maternity clothes. An expecting mother will spend any where from $100 to $1,000 on clothing. Be sure to take advantage of items that are passed along by friends and family. When shopping for work-wear try to find items that you can mix and match for the most use.
  • The nursery. This is the fun part, but it can also be expensive! The average nursery room costs between $750 and $1,450. Look around at different consignment shops for gently used items. Don't go overboard on bedding; some can be a hazard to the baby. Be sure to register for baby gifts. Since friends and family are sure to buy presents, you should ask for the items you prefer.

After arrival:

  • With the cost of college continually rising, establish a college savings plan as soon as you receive your child's Social Security Number.

Give your baby the best start in life by doing your financial homework first!

Submitted by Springfield Moms reader Christine Netznik, "Aunt C." to Cole and Brynn.  She works as the marketing director for Springfield Moms sponsor Marine Bank.

 MARINE BANK 200X120

 

 

 

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