6 Tips to Get Your Finances in Place When Planning a Pregnancy

If you are planning a pregnancy, you must understand that it is a huge responsibility not just in terms of physical or emotional manner but also in a financial manner. By the time your little one is 18, you would have spent about a quarter-million dollars on them. Children are expensive to raise and there are several situations when you will have to stretch your budget for them. You must learn to prioritize personal finance as soon as you think of starting a family or as soon as you find out that you are expecting. It will help build good habits and you will be able to make the most of your money. Here are a few tips to help ensure a bright future for your loved one.

1. Have a budget for after your baby’s birth

Whether you are a first-time parent or if you have been a parent for many years, you could be clueless about the cost of baby expenses that may arise in the first year. You must have a budget in place for the one year after your baby’s birth. There are cost calculators online that can help you get an idea about the expenses you may have to incur. Your budget should account for the time off from work right after birth or a decline in the income if you choose to stay away from work for a few months. 

2.  Account for child care costs now

If you want to continue the paid jobs, it is important to evaluate the daycare options. You want the best for your child and good facilities have waiting lists and high costs. Explore all the options and consider the costs associated with them.

3.  Repay debt and have an emergency fund

You have enough time now to repay the outstanding loans. Work towards eliminating credit card debt as soon as you can. Look for ways you can reduce debt. If your parents or in-laws are 62 and above, you can use a reverse mortgage to get access to funds on their home equity. It can help build your emergency fund. You can use a reverse loan calculator tool to get a quick insight into the impact it will have on your budget. If one of the parents is planning to quit the job, build an emergency fund for the next six months.

4.  Consider delivery costs

Not everyone has an employer-provided health insurance plan. So you must consider the cost of prenatal care and delivery. If you have typical health insurance from the employer, speak to the HR and check out the out-of-pocket costs you may have to incur. 

5.  Buy baby gear in advance

You do not need everything you see at the supermarket but you do need a few essential items. If you have been a parent earlier and have set aside the baby gear for the second child, you do not have to worry about this expense. But if you are a first-time parent, you need to buy baby gear in advance. It does not come cheap and you will see a lot of marketing all around you. It is important to know what is essential and what is not. Start planning the expenses well in advance and buy essential baby gear before the baby arrives. 

6.  Consider enrolling your baby on the health plan

Parents have 30 days after the baby arrives to put them on their health insurance plan. You must get the paperwork in place and fill out as much as you can before the birth of your little one. Hence, you will have less to do when the baby is here.

There is no joy like being a parent but you must understand that planning for finances is extremely crucial. You do not want to struggle to make your ends meet when the little one is here. Remember the sooner you start saving for them, the better. When a child enters a family, personal finance changes the dimension and you must plan early and efficiently. If you plan well, you will able to eliminate the financial bumps. Use the right financial tools and be very practical about your finances. It can be tempting to go out of the budget when shopping for your little one but do not give in to the temptation. 

Use these six tips to get the finances in place before you plan a pregnancy. You must also remember that saving for your retirement is equally important. Before you start saving for your child’s school or college, set up a retirement fund and contribute to it regularly. There are no scholarships for retirement and you do not want to take it lightly.