Having a Baby? 12 Best Financial Tips to Get You Financially Prepared

If you know you have a baby coming soon, you might have already thought about how you'll handle the costs of raising a new family.

The costs of having a baby and raising a child are forever increasing.

But if you don't have a pregnant loved one, it's still a good idea to start planning financially now.

There's no better time than now to start saving for your future and be financially prepared for your baby.

There are plenty of ways to do it too.

You can use an online savings plan, open a savings account, or even start a small business.

The point is, there are many ways to save, so don’t feel like you have to choose just one.

The following 12 tips will place you in a better place and financially ready for when your baby arrives.

12 Best Financial Tips to Get You Financially Prepared

1. Pay Down Consumer Debt

Pay down all your consumer debt if you are pregnant, especially if you are able to do so at no cost.

By doing so, your credit score will rise, and you might be able to lower your interest rate too.

Contact your creditors and try to negotiate for a lower payment.

If you do not have a credit score, it's also a good idea to start paying down your debt now.

If you can't pay off all your debt right away, make sure that you have enough money set aside for emergencies.

2. Learn the True Costs of Having a Baby

You might have planned to nurse your baby, but nature may have other plans.

Know how much formula costs in the worst-case scenario and not your ideal situation, so you're ready for the highest costs.

Don't forget the diaper costs, either.

If you're struggling to cover the cost of formula, there are other options.

You can find formula coupons online, use formula bank codes, or just ask family or friends.

Whatever you do, don’t give up on formula.

You can still provide your baby with the best start possible.

If you're working hard to save money to afford formula, but it's just not enough, don't worry.

There are other ways to provide for your baby.

3. Update Your Beneficiaries

Now is a good time to update your insurance beneficiaries and other information, since you are expecting.

Make sure you include your spouse as the primary person since anything might happen to you.

You may also want to create a will, discuss funeral arrangements with your family, and set up a trust.

These things may not seem urgent, but they matter at some point.

Consider the fact that we often do not appreciate the value of what we have until we lose it.

4. Go on a Money Diet

It’s easy to get caught up in enjoying yourself and neglecting your financial planning.

However, if you haven’t been making financial plans until now, you should take advantage of this time to cut down on nonessential spending.

This could include putting off buying that new pair of shoes or taking that trip to the beach.

You can’t put a price on enjoying yourself, but you can certainly put a price on putting your financial future at risk.

It’s important to start thinking about your financial future now so you can start planning for it.

5. Talk to HR at Work

When your first trimester is over, you should notify your employer about your pregnancy.

You will learn about any work-related benefits you may enjoy during your pregnancy, delivery, and the postpartum period.

Most employers will offer you the same benefits they provide their other employees.

In some cases, your employer may even offer you a higher level of coverage during this time.

However, if you plan ahead, you can ensure you keep your job and receive the necessary benefits.

Your employer may have a policy that prohibits you from working during your pregnancy.

In this case, you may have to find another job.

If that is not an option, you can ask your employer for a leave of absence.

6. Source Supplies from Thrift and Gently Used Stores

You can save money on new items and also have a better impact on the environment by buying gently used items.

Why would you want to do that?

You can help your children pay for school by buying gently used items.

Many parents do not have the money to buy new clothes for their children, so they have to shop at second-hand stores to find something that is affordable.

You can also give gently used items a new purpose.

You can donate these items to a charity that will make money and make an impact.

You can also sell your gently used items and make money to pay for what you need.

7. Check the Cost (and Availability) of Daycare

It’s best to look into your local daycare situation before you ever plan to send your child there.

You might be required to register while you're pregnant or miss out on a slot if you don't.

The best place to start your search is with your provincial ministry of early childhood.

They will have a list of licensed facilities in your area.

Once you find a daycare that you’re interested in, be sure to check out its staff qualifications.

Make sure that the staff members have received proper training.

And make sure that the facility is licensed.

This means that it’s free from any health and safety violations and is compliant with provincial regulations.

If you have any doubts, it’s best to double-check.

When you're ready to enroll your child, make sure that you do it as soon as possible.

If there's anything that you need to know, it will be on the list above.

8. Update Your Life Insurance

It is important to buy life insurance if you do not already have it before you face any difficulties.

Insurance is cheaper if you purchase it while you are young.

It is also cheaper if you purchase it long term rather than purchasing it for the short term.

It is also more affordable to purchase a policy with a longer duration.

If you are young and healthy and have the money, now is a good time to get life insurance.

9. Write a New Will

Now is the time to write a new will if the worst happens and the mother dies during childbirth so the child inherits.

You will want to make sure that you leave something for the child for emotional support, as well as for any financial support that may be needed.

It is also a good time to create a revocable living trust.

This will allow you to pass assets onto your children without them having to worry about receiving everything that you own at the moment of your death.

It can also prevent your children from being forced to sell valuable assets at a time when they may not be ready to do so.

10. Learn about Your State’s 529 Plans

Start looking into your state’s 529 plans as soon as possible if you want to save money on your child’s college education.

The time to start planning for college is as early as possible in your child’s life.

By starting young, you’ll have more time to save for college and less time to foot the bill.

If you start looking into 529 plans when your child is in middle school, you’ll be able to lock in a good rate and earn some tax benefits if your plan is sponsored by a state-run agency.

By the time your child is ready to start college, you’ll have a plan set in place and a funded 529.

11. Let Your Friends and Family Buy Gifts

It is the perfect time to invite your family and friends for a baby shower so they can purchase gifts for you and the new baby.

Make the most of your village life.

Plan one or two days ahead for the shower and invite your family and friends.

Purchase a gift for the new baby and decorate a nursery for the shower.

Invite a photographer to take pictures for you.

It is a very special moment in your life that you will cherish for years to come.

The best time to host a shower is during the first trimester.

The second trimester is when most people start fearing labor.

The third trimester is the time when most people are preparing for the arrival of a new baby so you will have a small window of opportunity to plan the shower.

12. Don’t Steal from Your Retirement

It is important not to drain or risk your retirement fund when planning for your baby's arrival.

Giving your children a comfortable retirement is a wonderful gift.

Start early by setting aside a small portion of each paycheck and increasing the amount each year.

Keep your employer’s retirement plan open and make sure to contribute as much as you can each year.

If you don’t have a retirement plan at your place of employment, open one yourself.

Keep your expenses low and don’t spend extravagantly.

Create a savings goal for your retirement.

Continue to save during your working years and when you can.

Your children are counting on you to give them a comfortable retirement.

Key Takeaways

The last thing that you want to do is find yourself with an unexpected financial burden at a time when you can least afford it.

Having a baby is an expensive process.

You will need to prepare for the financial costs now so that you're able to have enough saved for unexpected expenses when it comes, as well as for things like formula, diapers, and daycare in the future.

No one ever said having a baby would be easy, but having a baby while also ensuring that you are financially fit and prepared is the best way to make it go as smoothly as possible.

If you're expecting a child soon, make sure you start planning for the financial consequences now so you're able to have enough saved for the unexpected costs when it comes, as well as for things like formula, diapers, and daycare in the future.